European Shares Higher; Energy Costs Boost Euro Zone InflationEurostat also confirmed its earlier estimate that month-on-month prices in the 19 countries sharing the Euro rose 0.3%.
European stocks are higher on Friday, following the roadmap laid out by Asia Pacific indexes earlier in the day and another strong performance by Wall Street on Thursday. The catalyst for the early strength is China’s GDP report, which showed growth numbers in line with analyst expectations even amid the protracted trade war with the United States.
The news that China’s economy grew, by 6.1% in 2019, its slowest in 29 years, but coming out in line with analyst expectations was enough to underpin the European markets. This news, combined with the strong performance on Wall Street on Thursday, which saw the benchmark S&P 500 Index hit a record high on Thursday, are driving today’s early strength. U.S. shares were supported by a host of strong earnings reports from major banks, and solid economic data.
Corporate News at Forefront
Swiss luxury goods giant Richemont reported a slowdown in sales growth as political unrest in Hong Kong weighed on its fourth-quarter turnover.
Volkswagen CEO Herbert Diess said on Thursday that the German carmaker must accelerate urgent reforms to its business in order to avoid the same fate as Nokia, which relinquished its handset market dominance to Apple, Reuters reported.
Euro Zone Inflation Confirmed at 1.3% in December
A higher contribution from energy costs boosted Euro Zone inflation in December, data showed on Friday, as the EU’s statistics office confirmed its earlier estimate that consumer prices grew 1.3% year-on-year in the last month of 2019.
Eurostat also confirmed its earlier estimate that month-on-month prices in the 19 countries sharing the Euro rose 0.3%.
The energy contribution to the year-on-year index changed from -0.33 percentage point in November to a positive 0.02 points in December, accounting for the difference between the November inflation rate of 1.0% and December’s 1.3%.
The contributions of other major component of the index such as food, alcohol and tobacco, non-energy industrial goods and services were little changed from November.
The European Central Bank wants to keep inflation below, but close to 2.0 percent.