Source: Sharecast
The Sentix economic index registered 2.7 for October, down from 5.1 in September, with the current situation gauge unchanged at -3.3 but the expectations indicator falling to 8.8 from 13.8.
"Whilst the situation remains unchanged, expectations are easing noticeably, thereby raising doubts about the recovery scenario," the survey said.
While results for Germany indicate signs of "stabilisation", with the current situation index rising for the fourth straight month to -14.5 – its highest since May 2023 – investors were gloomier about the outlook, with the expectations index slipping to 8.0 from 12.3.
"The eurozone is struggling to emerge from its period of economic weakness. And this time, it is not primarily the weakness of the German economy that is weighing on the eurozone. Rather, the focus is shifting to the French economy and, in particular, the sharp rise in yields on French government bonds," Sentix said.
Yields on 10-year OAT French government bonds have been sold off sharply over the month, with the 10-year OAT yield rising by 70 basis points. The spread between OAT and German Bund yields is widening "so sharply that it is evoking memories of the 2011 sovereign debt crisis", the report said.
Meanwhile, investor sentiment also weakened worldwide due to a poorer outlook, with the global Sentix index falling to a three-month low of 13.5 in October from 14.6 in September.