European stocks steady despite plummet in German exports

Germany's exports recorded their sharpest drop in over 50 years in 2009, new data showed on Tuesday. But the bad news didn't seem to worry investors, who continued to push up European stocks for the second day in a row.London's FTSE 100 index climbed by 0.67 per cent to 5,125.73 points; Frankfurt's DAX 30 gained 0.52 per cent, the Paris CAC 40 advanced 0.25 per cent and the DJ Euro Stoxx 50 index of top eurozone shares grew 0.47 per cent.

Photo: AFP

The gains came despite news that German exports fell by 18.4 per cent last year, their biggest drop since 1950, according to the country's federal statistics office.

 
With 803.2 billion euros of exports to China's 876.5 billion euros, Germany - Europe's largest economy - is now no longer the world's biggest exporter.

The news comes as little surprise after declines in monthly figures from the beginning of 2009.

Yet there were positive signs in December's data, which show that exports rose by 3.4 per cent compared to the month before.

However, analysts say that German exports could be prevented from continuing their rebound by problems in Germany's eurozone trading partners.

Massive public debt in several European countries, notably Greece, threatens to slow stronger economies' recovery.

Greece will raise its average age of retirement by two years by 2015 in a bid to tackle the country's crippling 300-billion-euro debt, Labour Minister Andreas Loverdos announced on Tuesday.

The reform is part of a cost-cutting plan that aims to save 4.5 billion euros this year.