Sentiment in the euro zone rises to its highest level this year in June, suggesting investors have shaken off concerns about the global economy. As Grace Pascoe reports, German industrial orders painted a contrasting picture.
As summer hots up, so too has euro zone sentiment. Rising to its highest level this year for June. The Sentix index is UP to 9.9 from 6.2 in May Suggesting investors have shaken off global economic clouds. (SOUNDBITE) (English) BGC PARTNERS MARKET STRATEGIST, MIKE INGRAM, SAYING: "Assuming... job creation is still continuing at a reasonable pace and wage increases are about 2.5 percent at the moment, and oil prices remain relatively low, that's all going to support disposable income and consumer and investment confidence." But in Germany industry orders have dropped. Down 2 percent for April - marking the biggest monthly fall in nine months. Foreign orders plunged 4.3 percent With non-euro zone demand down 8.3 percent. (SOUNDBITE) (English) BGC PARTNERS MARKET STRATEGIST, MIKE INGRAM, SAYING: "Emerging markets are 60 plus percent of the global economy. And that being a point in case it means that global growth is also relatively low. Developed markets cannot effectively de-couple from emerging and those that put out that theory at the time of the Chinese devaluation in August last year I think are having to eat their words right now." Despite the foreign fall, German domestic demand increased UP 1.3 percent, cushioning the overall decline.