Eurozone to see strong growth in second quarter

Eurozone to see strong growth in second quarter

Eurozone to see strong growth in second quarter

European stocks closed in the green on Tuesday, with French shares among the biggest advancers as eurozone economic activity remained at a six-year high.

Britain borrowed more than expected last month.

May 23 Businesses across the euro zone maintained April's blistering growth rate this month as firms struggled to meet growing demand, suggesting the bloc's economic momentum is being sustained, a survey showed. It is the highest in six years, with the services sector up to 58.0 from 56.7.

- Detailed PMI data are only available under licence from IHS Markit and customers need to apply to IHS Markit for a licence.

Growth was not limited to Europe's largest economy, with the region-wide PMI reading remaining unchanged at a six-year high of 56.8 points.

The French services sector, which at around 79 per cent of GDP makes up a similar proportion of the economy to the United Kingdom, saw its strongest expansion in six years, although the manufacturing sector dipped slightly from recent highs. The closely watched gauge of business mood in Germany rose to a record high in May, with the Ifo business climate index hitting 114.6 from an upwardly revised 113.0 in April. A rush of eurozone data released Tuesday points to an economy that hasn't stopped surprising on the upside.

Gross domestic product grew 0.6 percent sequentially, in line with preliminary estimate and faster than the 0.4 percent expansion seen in the fourth quarter. "Business activity is expanding at its fastest rate for six years so far in the second quarter, consistent with 0.6- 0.7% GDP growth". This has resulted in the country's budget deficit jumping to £10.4bn in April, that's £1.2bn or 13% more than a year ago according to the office of national statistics. The suspension comes as a lead in the polls for British Prime Minister Theresa May's Conservative Party "continues to be eroded in favour of [Jeremy] Corbyn's Labour, with 90,000 new voters registered just yesterday", said Accendo Markets analysts in a note.

The expected level of PSNB was GBP 8.8 billion.

The Commerce Department said new home sales plunged by 11.4 percent to an annual rate of 569,000 in April from an upwardly revised 642,000 in March. Also, the Ifo current assessment index in the nation advanced unexpectedly to a level of 123.2 in the same month, compared to market expectations of a fall to a level of 121.0, after a revised reading of 121.4 in the previous month.

Additionally, the nation's services activity unexpectedly slid to a level of 55.2 in May, from a reading of 55.4 reported in the previous month.

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