European investor confidence falls

According to a survey conducted by the Germany-based Sentix research institute, European investor confidence slumped to the lowest in more than three years, as the euro-region sentiment fell to minus 9.3 from a positive 5.2, as oil prices have caused damage to the profits of many companies.

This latest survey was carried out among more than 2,800 European investors.

The affect on crude oil profits are being felt, as well as the reduction in economic output as a report from euro zone’s largest economy by the Ministry of Economy and Technology, showed that industrial output in Germany fell by a seasonally adjusted 2.4% month-on-month in May.

A statement from Sentix indicated that investors are struggling to get to grips with high oil prices and the strength of the euro, which are reducing the stability of the economy and so the research group expect the third and fourth quarters to also recede.

The economy of the 15 euro nations is falling as consumer spending is down following the increase in food, fuel and energy bills and it is clear that the barrel hitting $140 dollars has affected business confidence as well as the domestic market.

This, coupled with the fact, that the euro has advanced against the dollar has also hit exports and is a cause of the slowdown.

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