European stock markets experienced marginal gains on Friday, with the DAX index in Germany, the FTSE 100 in the UK, and the CAC 40 in France all trading slightly higher. However, these indices are on track to post losses for the week, with the STOXX 600 index falling for seven consecutive days.
French industrial production data for July provided some optimism as it rebounded by 0.8% on a monthly basis, surpassing expectations. Spanish industrial production also fared better than expected, declining by 1.8% in July compared to an anticipated 2.0% drop. However, Germany, the eurozone’s largest economy, reported a more substantial industrial production decline than forecasted.
The eurozone’s GDP growth for the second quarter stood at just 0.1%, leading Citigroup to downgrade its 2023 economic growth forecast for the euro area to 0.4%. The European Central Bank is considering another interest rate hike next week due to persistently high inflation in Germany, which remains significantly above the central bank’s 2% target.
Meanwhile, concerns about China’s economic recovery persisted, and revised data showed that Japan’s second-quarter economic growth was lower than initially estimated.
Apple’s recent troubles in China have also impacted the tech sector. Reports of China restricting iPhone use by state employees resulted in a $200 billion decline in Apple’s market capitalization over two days. This comes ahead of Apple’s expected iPhone 15 lineup unveiling next week.
In other news, Casino stock fell 1.6% after Euronext announced that the debt-ridden supermarket retailer would be excluded from a key French equity index of major companies.
Crude oil prices retreated from their recent 10-month highs due to concerns about China’s economic health and a stronger US dollar. However, both Brent and WTI crude were still on track to post approximately 1% gains for the week. US inventories fell by 6.3 million barrels in the week ending September 1, marking the fourth consecutive weekly decline.
Gold futures rose by 0.3%, and the EUR/USD currency pair traded 0.1% higher.
Overall, European markets remain cautious amid economic uncertainties both domestically and globally.