The Software & Services sector was the top performer in Europe in January 2025, according to the latest S&P Global Europe Sector PMI report.
Software & Services was the best performer for the first time since last September, the data showed, which in turn boosted the wider Technology category.
The broader Consumer Goods category was supported by a renewed expansion in both Beverages & Food output, and stabilisation in Household & Personal Use Products production, S&P Global noted, while the Automobiles & Auto Parts segment reported its slowest production decline since June 2024.
Metals & Mining was the worst-performing sector for the first time in eight months, replacing Automobiles & Auto Parts at the bottom of the list.
Elsewhere, demand conditions weakened in the Financials sector, the Real Estate and Banks categories reported slower growth in new orders, while Other Financials posted its sharpest sales decline since November 2022.
In total, 13 monitored sectors recorded a drop in new business, largely in services.
‘A broad divergence’
‘European sector data continued to signal a broad divergence in performance between manufacturing- and services-based segments of the economy in January, according to the latest S&P Global Europe Sector PMI,’ the report noted.
‘Nonetheless, this divergence eased as many services-focused sectors recorded slower growth in output or renewed contractions. Conversely, manufacturing-based sectors largely saw softer declines in production at the start of 2025.’
Employment decline
Some 16 sectors recorded a decline in employment levels, the highest number since August 2020. This was accompanied by greater depletion of backlogs and rising cost pressures.
While demand was weaker in most segments, 17 sectors increased their selling prices – the only exceptions were Automobiles & Auto Parts and Metals & Mining, where companies cut prices to stimulate new orders. Read more here.
