According to the report from IHS Markit, the Eurozone Construction Total Activity Index rose from 49.5 in August to 50.0 in September, signalling a stabilisation in eurozone construction activity following two successive months of decline. Where activity rose, companies often cited stronger demand growth, although this was offset by a lack of raw materials which halted work on site. Underlying data indicated that growth was centred around house building, although commercial construction work fell at the softest pace in the current 19-month sequence of decline. At the same time, the fall in infrastructure activity remained sharp.

September survey data pointed to a further expansion in home building activity across the eurozone, stretching the current period of growth to seven months. While softer than that seen in August, the rate of increase was solid overall. Commercial building activity continued to trend towards stabilisation in September, as activity dipped at the softest pace in the current 19-month sequence of decline. Work undertaken on civil engineering projects decreased at a softer pace in September. The fall stretched the current period of decline to 26 months and the rate of reduction remained sharp.

New orders placed with eurozone construction companies expanded for the second successive month in September. The pace of growth quickened from the previous survey period and was the fastest since May. Anecdotal evidence suggested that government incentives for the sector as well as a number of new projects coming to tender led to a rise in new business inflows.

Eurozone construction firms expressed optimism toward the 12 month outlook for the ninth consecutive month in September. The level of positive sentiment strengthened from August and was sharp overall. Italian firms were the most upbeat, while confidence across France improved to a three-month high. That said, projections in Germany remained downbeat.