European stocks lower; sentiment weak despite strong German factory orders

By Peter Nurse - European stock markets traded lower Monday, with investors fretting about rising Sino-U.S. geopolitical tensions and the global economic outlook despite a healthy rebound in German factory orders.

At 04:00 ET (09:00 GMT), the DAX index in Germany traded 0.6% lower, the CAC 40 in France fell 1% and the FTSE 100 in the U.K. dropped 0.6%.

German industrial orders rose in December, increasing by 3.2% on the month in December, a substantial rebound from the upwardly revised drop of 4.4% in November.

This is the latest sign that Europe’s largest economy will get through the winter without seeing a dramatic slump.

However, this positive news comes after Friday’s strong U.S. jobs data provided more room for the Federal Reserve to continue tightening interest rates to combat inflation.

The European Central Bank also hiked interest rates last Thursday, and its policymakers were keen to point out that more was needed to tame inflation.

This hawkish talk has raised fears that growth on both sides of the Atlantic could stall this year, weighing heavily on corporate profits in the next few quarters. 

Eurozone retail sales for December are due for release later in the session, and are expected to show a fall of 2.5% on the month, an annual drop of 2.7%.

Also weighing on sentiment was the news that the U.S. shot down a suspected Chinese spy balloon over the weekend, a move that was condemned by Beijing which claimed the balloon was used for meteorological purposes and had accidentally drifted into U.S. airspace.

In corporate news, Renault (EPA:RENA) and Nissan (TYO:7201) have received approval from their boards to go ahead with a restructuring of the 24-year-old alliance between the two carmakers.

Under the revamped partnership, which was previously announced last month, Renault's stake in Nissan will fall to 15% from 43%, while Nissan has agreed to invest up to 15% in Ampere, Renault's new electric vehicle division.

Renault’s stock rose 0.1% Monday, outperforming the negative wider tone. 

Oil prices edged higher Monday, rebounding after last week’s hefty losses, helped by positive comments on the potential recovery in Chinese demand this year from the International Energy Agency. 

IEA head Fatih Birol indicated over the weekend that early signs pointed to a stronger-than-anticipated rebound in China’s economy, likely resulting in a healthy boost to crude demand from the world’s largest importer.

Oil prices slumped last week to more than three-week lows on fears slower growth in major economies like the U.S. and Europe may limit fuel consumption in 2023.

By 04:00 ET, U.S. crude futures traded 0.6% higher at $73.83 a barrel, while the Brent contract rose 0.8% to $80.58. Both contracts dropped 3% on Friday after strong U.S. jobs data, resulting in losses of around 8% over the course of the week. 

Additionally, gold futures rose 0.8% to $1,891.50/oz, while EUR/USD traded 0.1% lower at 1.0785.

Begin trading today! Create an account by completing our form

Privacy Notice

At One Financial Markets we are committed to safeguarding your privacy.

Please see our Privacy Policy for details about what information is collected from you and why it is collected. We do not sell your information or use it other than as described in the Policy.

Please note that it is in our legitimate business interest to send you certain marketing emails from time to time. However, if you would prefer not to receive these you can opt-out by ticking the box below.

Alternatively, you can use the unsubscribe link at the bottom of the Demo account confirmation email or any subsequent emails we send.

By completing the form and downloading the platform you agree with the use of your personal information as detailed in the Policy.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.3% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Back to top

Office network

One Financial Markets is the trading name of Axi Financial Services (UK) Ltd, a company registered in England with company number 6050593. Axi Financial Services (UK) Ltd is authorised and regulated by the Financial Conduct Authority in the UK (under firm reference number 466201) and the Financial Sector Conduct Authority in South Africa (with FSP number 45784).

The information on this site is not directed at residents of the United States, Belgium, Poland or any particular country outside the UK and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation. is owned and operated by Axi Financial Services (UK) Ltd.

Award winning broker
We have been presented with a number of awards that recognise the quality of our service and dedication to our clients :

Best FSA Regulated Broker
Saudi Money Expo

Best Education Product
Saudi Money Expo

Best Broker - Online Trading
IAIR Awards

Best Institutional Broker
Saudi Money Expo

Best FX Services Broker
CN Forex

Top International
FX Broker 2015

Saudi Money Expo

Broker of the Year
Online Trading – Middle East

IAIR Awards

Best Forex
Customer Service 2018

JFEX Awards

We accept the following payment methods: