European stock markets are trending positively, except for Spain, due to the decline in oil prices.
As of 11.30 in the European markets, the Stoxx Europe 600 indicator index is traded at 637.3 points, with an increase of 0.25 percent, and the FTSE 100 index in the UK is traded at 10,737 points, with an increase of 0.44 percent.
In Germany, the DAX 40 index is at 25,346 points, with a 0.65 percent increase compared to the previous close, in Italy, the FTSE MIB index is at 48,940 points, with a 0.81 percent increase, in France, the CAC 40 index is at 7,838 points, with a 0.72 percent gain, and in Spain, the IBEX 35 index is at 18,877 points, with a 0.59 percent decrease.
With the decline in oil prices, the recovery trend in European stock markets comes to the fore.
France’s 10-year bond interest rose to 5.07 percent, reaching the highest level since 2002. France’s 5-year credit risk premium (CDS) reached its highest level since 2012 at 103.2.
On the other hand, international credit rating agency Moody’s announced that it has completed its periodic review of France’s credit ratings.
In the statement made by Moody’s, it was stated that France’s credit rating of “Aa3” is supported by its rich and diversified economy and strong public institutions, and it was emphasized that the main credit difficulties are the fragmented parliamentary structure, political and social instability, high and increasing debt burden and the weakening of debt coverage metrics.
In the statement, it was stated that France’s debt burden exceeded expectations due to the slowdown in economic growth and the increase in the budget deficit since the previous review.
The statement pointed out that government bond interest rates rose faster than expected during this period, and that large-scale social protests broke out that could restrict fiscal consolidation efforts.
Looking at the macroeconomic data side, in the Eurozone, October’s manufacturing industry Purchasing Managers’ Index (PMI) was slightly below expectations at 52.4, while in Germany, October’s manufacturing industry PMI was above expectations at 54.2.
Manufacturing PMI in the UK was recorded as the best performance of the last 5 months with 52.8 points.
France’s leading composite Purchasing Managers Index (PMI) data for October pointed out a contraction in economic activity in the country. Composite PMI in France, which was 51.1 in September, fell to 48.4 in October, the lowest level in the last 4 months.
This week, the interest rate decision of the European Central Bank (ECB) will be in the focus of European markets. The bank is expected to keep its three main policy rates constant.
Analysts said that if energy costs rise further in the future and the growth outlook of the European economy remains weak, the bank may be in a dilemma between fighting inflation and economic activity.
On the other hand, British Finance Minister John Healey is expected to make his first budget presentation on Wednesday. Increasing global borrowing costs and high energy prices caused by the US/Israel-Iran War also have a significant impact on the UK economy.
