European stocks edged higher on Tuesday snapping from their losses on Monday. Germany’s DAX index increased after the country’s strong Producer Price Index. Euro STOXX 50 index advanced ahead of the ECB monetary policy statement later in the week. UK’s FTSE 100 index was positive ahead of UK’s Retail sales data for June scheduled on Friday. French CAC 40 index was also up ahead of France manufacturing PMI later this week.
German Economic Outlook
The DAX index inched higher after the German Producer Price Index (PPI) for June. The producer prices of industrial products advanced 8.5% in June 2021 compared to last year. According to the Federal Statistical Office (Destatis), this was the sharpest increase since January 1982 compared to June 2020.
Commercial producer prices rose increased by 1.3% in June 2021 compared to the previous month. It surpassed the 1.1% estimate forecast but fell from the 1.5% increase in May. The increase in prices of intermediate goods and energy drove the increase in commercial producer prices.
The prices of intermediate goods jumped 12.7% compared to June 2020 and went up 1.8% compared to May 2021. The prices of metallic secondary raw materials from iron, steel, and scrap metal were the highest with an 88.1% increase.
Germany recorded strong price increases for all energy sources. The energy prices were 16.9% higher compared to June 2020 and 2.2% compared to May 2021. The increase was primarily due to the sharp fall in prices in 2020 due to the coronavirus pandemic.
DAX Index Movers
Among the top performers in the DAX index include Muench Rueckvers, BASF, Allianz, and Bayer. Muench Rueckvers gained 2.51% in its stock earnings. the insurance company was among the laggards in the DAX index on Monday after losses in the insurance sector.
BASF is the largest chemical producer company in the world. The company gained 2.20% in its stock earnings. The company recently announced the appointment of its newest Color Source member, Crest Industries.
Allianz SE is a German financial services company. The company was up 1.99% on Tuesday after recently restructuring its operations in the UK to create distinct Personal and Commercial businesses.
Bayer gained 2.09% in its stock prices. A few weeks ago, the pharmaceutical company announced the launching of its decarbonization program in Europe.
Among the laggards in the index include SAP and Fresenius Medical Care. SAP, a software company, was in the red after investing €250 million in the UK-based cloud service.