Eurozone GDP: France posts strongest annual growth since 2011 – business live

All the day’s economic and financial news, including new eurozone growth figures

Latest: Spain keeps growingFrance sparkles with best growth since 2011
French GDP rose by 1.9% in 2017The agenda: Eurozone GDP figures

8.50am GMT

Europe’s major stock markets have all fallen this morning, despite the solid growth figures from France and Spain.

Goldman warns of a market correction as S&P 500 & MSCI World have entered their longest period w/o correction of >5%. Says bear market risks low. Says drawdowns within bull markets of 10% or more are not uncommon. Goldman finds 22 since 1945. pic.twitter.com/ujghn9JqLP

8.31am GMT

Some reaction to the Spanish growth data:

Spanish economy grew by more than 3% (again!) in 2017. Still 1% away from full capacity but output gap is narrowing fast. Should be closed by early 2019, after France but way before Italy. Spain now entering a ‘slowdown’ phase after stellar years. My take: https://t.co/9KXNyued1l pic.twitter.com/cdIcrCvq0y

8.13am GMT

Newsflash: Spain’s economy grew by 0.7% in the final quarter of 2017.

8.05am GMT

Update: the pound is slipping lower.

GBPUSD back below 1.40; it really had no business above that level

7.52am GMT

The most encouraging part of the French growth report is that business investment has risen sharply.

This means French firms have boosted their spending on equipment, offices and factories – a sign that they’re more confident about their future prospects.

French GDP growth was 1.9% in 2017, highest since 2011. All about domestic demand although net exports have started to contribute positively at the end of the year. pic.twitter.com/j7LybYjTkl

The big story in France (and the euro area), is investment. Up 9% in two years, and back above pre-crisis levels for the first time in Q4-17. pic.twitter.com/6JVz5AIIRP

7.40am GMT

Brexit worries are weighing on the pound again this morning.

Sterling has shed half a cent against the US dollar, to $1.402, after leaked government papers showed that Britain’s economy would be worse off under all three likely Brexit scenarios.

The document suggested that chemicals, clothing, manufacturing, food and drink, and cars and retail would be the hardest hit and every UK region would also be affected negatively in all the modelled scenarios, with the north-east, the West Midlands and Northern Ireland facing the biggest falls in economic performance.

Related: Brexit would damage UK growth, says leaked cabinet report

7.19am GMT

France is benefitting from President Emmanuel Macron’s election win and the upturn in the global economy, says Bloomberg.

They add:

Macron’s government is currently working with unions and business lobbies to overhaul France’s job training system, and will move on to unemployment insurance in coming months.

Finance Minister Bruno Le Maire plans a major economy law for the spring that aims to further loosen restrictions on businesses, as well as increase profit-sharing plans for employees.

French economy sustains momentum, has its best year since 2011 https://t.co/Uz89HfQlCS pic.twitter.com/iFtwnKumXy

6.51am GMT

Newsflash: France’s economy grew by 0.6% in the last three months.

French revival? GDP up 1.9% in 2017, highest since 2011 …4Q GDP +2.4% on year thanks mainly to business investment #macron #france

6.36am GMT

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Today we learn if Europe’s economic recovery is on track.

Opening calls
FTSE100 is expected to open 46 points lower at 7,625
DAX is expected to open 99 points lower at 13,225
CAC40 is expected to open 34 points lower at 5,487

After such a promising end to last week where the Dow rallied 200 points to a fresh record close, trading on Monday couldn’t have been more different. US stocks experienced a spectacular reversal and plummeted overnight, as the US 10 year treasury yield pushed relentlessly higher. Concerns are starting to enter the market that inflation could be catching up and higher interest rates could pour cold water on the bull run.

As the US treasury bond sell off depended, US treasury yields shot up to a peak of 2.73%, the highest level since 2014.The Dow dumped 177 points in its worst trading day so far this year and the S&P dived 0.7%.

Continue reading…