THE MAJOR EUROPEAN SCHOLARSHIPS ARE EXPECTED TO FALL
by Marc Angran
PARIS (Reuters) – Major European stock markets are expected to fall on Wednesday after Wall Street closed in the red as the latest US inflation data was not enough to permanently allay fears over US monetary policy tightening.
Index futures point to a 0.21% decline for the Dax in Frankfurt, 0.19% for the FTSE 100 in London and 0.16% for the EuroStoxx 50. The CAC 40 in Paris could be virtually unchanged according to the first available indications. to open.
Monthly US consumer price data released Tuesday brought brief relief to markets as there were no nasty surprises, with core inflation data even pointing to a slowdown. But clearly more is needed to fully reassure investors about the Federal Reserve’s intentions.
Especially as some Fed officials continue to call for a rapid rate hike, such as James Bullard, the president of the St. Louis regional branch: in an interview with the Financial Times, he explains that consumer price statistics indicate that “the Fed is lagging behind and must take action”.
The session of the day will be animated, among other things, by inflation data in the United Kingdom, expected at 06:00 GMT, by those of producer prices in the United States, at 12:30 GMT, then at 14:00 GMT by the policy decision of the Bank of Canada, which could be the first G7 central bank to raise its key interest rate by half a point.
Economic indicators from Asia are also not very encouraging: in China, monthly foreign trade statistics show a 1.7% drop in imports over a year measured in yuan, and in Japan industrial equipment orders fell by 9.8 in February % from January, their largest monthly decline in nearly two years.
AT WALL STREET
The New York Stock Exchange ended lower Tuesday after wiping out early trading gains as the prospect of a Federal Reserve tightening monetary policy next month weighed on growth stocks again and supported returns.
The Dow Jones index fell 0.26% or 87.72 points to 34,220.36, the Standard & Poor’s 500 lost 15.08 points or 0.34% to 4,397.45 and the Nasdaq Composite lost 40.38 points (- 0.30%) to 13,371.57.
The trend reversal was aided by statements from Fed Governor Lael Brainard, who emphasized the need for the central bank to fight inflation “quickly”.
Futures suggest an open of around 0.5% so far.
IN ASIA
On the Tokyo Stock Exchange, the Nikkei index gained 1.61% less than an hour after closing, moving away from its nearly one-month low on Tuesday, following a decline that some investors considered excessive.
In China, the Shanghai SSE Composite lost 0.28% and the CSI 300 0.31% as markets continued to doubt the nature of the credit and business support measures that authorities should announce in the coming months, hours or days .
RATE
U.S. bond yields, which had fallen sharply on Tuesday after consumer price data, rose again in early trading: the two-year, the most sensitive to interest rate expectations, resumed just over two basis points at 2.4056% and the 10-year rises to 2. .7481 %.
CHANGES
The euro remains plagued by fears sparked by the impact of the war in Ukraine, as it bounced back to its lowest level since March 7 against the dollar at 1.0813 early in the day, before rising as low as 1 ,0829. However, on the eve of the decisions of the European Central Bank (ECB), fluctuations could remain contained.
The dollar has remained virtually unchanged against a basket of reference currencies (+0.04%).
Also note the appreciation of the New Zealand dollar (+0.42%) following the half-point hike decided by New Zealand’s central bank, the largest since 2000.
OIL
The price of a barrel of oil, which rose above a dollar at the start of the session, is now trending slightly downward, a sign that the market remains torn between the prospect of supply tensions in the event of an embargo on Russian crude oil and demand concerns related to health restrictions in China.
Brent fell 0.11% to $104.52 a barrel and US light crude (West Texas Intermediate, WTI) fell 0.27% to $100.33.
(Written by Marc Angrand)
