by Marc Angran
PARIS (Reuters) – Major European stock markets are expected to rise Friday after Wall Street’s positive close and should thus reduce their losses for the week, dominated by the prospect of a rapid rise in US key interest rates.
Futures contracts on indices suggest an increase of 0.72% for the Dax in Frankfurt, 0.67% for the FTSE 100 in London and 0.86% for the EuroStoxx 50. As for the CAC 40 in Paris, it would the first indications available.
The Paris market has lost 3.3% since the start of the week and should end with its worst weekly performance in a month. The broad European Stoxx 600 index fell 0.72% in four sessions.
While the recovery in US indices at the end of Thursday’s session is reassuring, investors are nonetheless concerned about the fallout from the US Federal Reserve’s monetary policy tightening, as its latest meeting report reflects the excellent economic event. this week.
However, two Fed officials, Charles Evans and Raphael Bostic, gave a more moderate speech on Thursday, with the former referring to the need for a “measured” approach.
Markets are also starting to position themselves for the first quarter earnings season: In the US, Standard & Poor’s 500 earnings are expected to rise 6.4% year-over-year, according to data from Refinitiv. last three months of 2021.
With the day’s economic calendar practically blank, markets remain alert to information about the war in Ukraine, whether it be the expected Russian offensive in the east of the country or economic sanctions against Moscow.
AT WALL STREET
The New York Stock Exchange ended higher on Thursday, with gains from Pfizer (+4.3%), Microsoft (+0.6%) and Tesla (+1.2%) helping to recover at the end of the session.
The Dow Jones index gained 0.25% to 34,583.57 points, the Standard & Poor’s 500 gained 0.43% to 4,500.21 and the Nasdaq Composite rose 0.06% to 13,897.30 points.
The S&P 500 had been in the red for most of the session, punished by questions related to the conflict in Ukraine and the Federal Reserve’s impending monetary tightening. Traders are now pricing a 50 basis point hike in the Fed’s key rate next month at 88.9%.
HP rose 14.8% after announcing its entry into the capital Berkshire Hathaway, the group led by Warren Buffett.
On the Tokyo Stock Exchange, the Nikkei index is trading 0.15% less than an hour after closing, investors are playing it safe on Wall Street’s lack of momentum, and it is headed for a nearly 3% decline over the course of the year. week.
Toyota lost 3.74% after reports from the Australian press called for a heavy fine for defective particulate filters.
In China, the trend is hesitant, between concerns related to the new wave of the COVID-19 epidemic and hopes of new economic stimulus, which some analysts say are imminent: the Shanghai SSE Composite and the CSI 300 are virtually unchanged .
The dollar continues to benefit from the prospect of a rapid rise in US interest rates and the index measuring its movements against a basket of reference currencies, up 0.15% to 99.90, is approaching the 100-point threshold, which he has not exceeded since May 2020.
The euro fell 0.17% to $1.0859, its lowest level since March 8. The new package of EU sanctions against Russia has revived fears of a marked impact of the conflict on the economy of the 27. In addition, some traders are calling for caution ahead of the first round of the French presidential election.
In the government bond market, US Treasury yields continue to rise, but below their highest levels in recent days, at 2.6622% for the 10-year and 2.5074% for the 2-year.
The price of a barrel fell and is heading for a decline of about 3% for the whole week, dominated by the announcement of the International Energy Agency (IEA) countries calling on their strategic reserves of EUR 240 million barrels in total.
Brent fell 0.68% to $99.90 a barrel and US light crude (West Texas Intermediate, WTI) 0.47% to $95.58.
The drop related to the IEA’s decisions, which will be in effect at up to a million barrels per day from May to the end of the year, could limit price gains in the near term, but will not change the fundamentals of the market. many analysts point out.
(Edited by Matthieu Protard)