Closing summary
European stock markets have notched up modest gains today. The FTSE 100 index is 57 points ahead at 7,720, a 0.75% gain. The German, French and Italian incides have gained between 0.3% and 0.9%.
UK house prices rose unexpectedly for a third month in a row in March in a sign of “resilience” in the market according to the latest report from Halifax.
The lender said the average price rose by 0.8% month on month, to £287,880, which followed rises of 0.2% and 1.2% in January and February. The increase defied economists’ expectations of a 0.3% fall.
Over the past 12 months house price growth has eased to 1.6%, its slowest rate since October 2019, Halifax said on Thursday, but prices rose in every region of the UK during March.
Economists have been waiting to see the extent of the slowdown in the British housing market amid high inflation and rising interest rates by central banks in response.
And here is our full story on Sainsbury’s:
Sainsbury’s has defended itself against criticism of new plastic packaging for mince which shoppers have criticised as “very medical”, “too compressed” and “vile”.
We are closing up for today. Thank you for reading. Have a wonderful Easter weekend! We’ll be back on Tuesday, as the UK and European markets are closed on Good Friday and Easter Monday – JK
German recession fears fade after strong factory output
There was some good news from Germany this morning, where factory output rose 2% in February, following 3.7% growth in January.
Economists said this suggests that Europe’s biggest economy can avoid a technical recession (defined as two or more consecutive quarters of contraction), although it doesn’t mean that it’s out of the woods yet.
Carsten Brzeski, global head of macro at ING, said:
German industry seems to have woken up from hibernation and has by now more than made up for the sharp plunge in December. The strong rebound seems to be driven by the reopening of China, strong activity in the automotive sector and a more general ongoing reduction of backlogs. Despite the strong rebound, however, industrial production is still slightly below its pre-pandemic level.
Yesterday, leading German economic research institutes slightly revised upward their growth forecasts for 2023 to 0.3%, from -0.4%. While this created a collective sigh of relief in German media, we remain more cautious. Admittedly, this week’s strong industrial data take away the risk of a technical recession.
However, despite the recent surge in new orders, the inventory build-up as well as the expected slowdown of the US economy argue against too much industrial optimism. It would not be the first time that the German (and the European) economy starts the year on a positive note, just to lose momentum over the course of the year. Finally, don’t forget that the recent financial turmoil and broader impact of the most aggressive monetary policy tightening in decades will weigh on economic activity.
