by Claude Chendjou

PARIS (Reuters) – European stock markets erased much of their early-trading gains on Tuesday to end on a stable note, while Wall Street fell in late morning in New York after data on U.S. inflation showed a acceleration in prices over one month but a slowdown at an annual rate.

In Paris, the CAC 40 ended with a gain of 0.07% to 7,213.81 points. The British Footsie nibbled 0.08%. The German Dax, on the other hand, lost 0.11%.

The EuroStoxx 50 index fell 0.06%, while the FTSEurofirst 300 and the Stoxx 600 each gained 0.08%.

At the close in Europe, the Dow Jones fell 0.92%, the Standard & Poor’s 500 0.71% and the Nasdaq 0.58%, as new inflation data raise questions about changes in US Federal Reserve (Fed) interest rates.

The US Department of Labor indicated that the consumer price index (CPI) rose to 0.5% in January after +0.1% in December (revised figure of -0.1%). Over one year, however, it has slowed to +6.4%, the weakest rate since October 2021, after peaking at +9.1% in June.

After the data was released, Richmond Fed Chairman Thomas Barkin stressed that it would take time to bring inflation back near the US central bank’s 2% target, adding that risks Inflationary risks still outweighed the other risks, notably those relating to the economic situation.

“Inflation is normalizing, but it is slowly declining,” he said. “If inflation persists at levels well above our target, we may need to do more,” he added.

A Reuters survey shows that analysts expect the Fed to hike rates at least twice more in the coming months, which would take the federal funds rate target to 5%. -5.25% against 4.50%-4.75% currently.

In values ​​on Wall Street, several technology and growth groups, sensitive to interest rates, were in the red, like Apple which declined by 1.34% and Amazon which yielded 1.53%.

Financial publications also animate the exchanges, such as Coca-Cola down 1.13% despite a profit forecast higher than expected for this year. The prospects for Marriott International (+1.39%) and Palantir Technologies (+13.40%) are however welcomed.

VALUES

In Europe, the market resisted the downward trend on Wall Street, being driven mainly by the defensive compartment of telecoms (+1.54%).

The British operator Vodafone jumped 3.42% after the announcement of an equity investment by the American Liberty Global in its capital.

The transport and leisure index (+1.25%) was also sought after, with TUI (+0.67%) reporting promising summer bookings on Tuesday.

In Paris, Airbus ended in the green after the announcement of a giant order by Tata Group, owner of Air India, while TF1 fell 3.99% following a change in governance.

Red lantern of the Stoxx 600, the German group Thyssenkrupp (-10.42%) was penalized by a plunge of around 30% in its quarterly profit.

THE INDICATORS OF THE DAY

GDP growth in the euro zone was confirmed at +0.1% in the fourth quarter after +0.3% in the third, according to data published by Eurostat.

CHANGES

The dollar is stable (0.09%) against a basket of international currencies, allowing the euro to show up at 1.0724 dollars.

The Japanese currency, rising to 131.79 yen per dollar, was supported by the expected appointment of Kazuo Ueda as head of the Bank of Japan (BoJ), which revives hopes for a change in strategy ultra-accommodating central bank.

RATE

Bond yields rose sharply after the inflation figures in the United States, the American ten-year gaining seven basis points, to 3.78%, and the two-year more than 10 points, to 4.63%.

In Europe, the yield of the German Bund for the two maturities followed suit with an increase of 7.2 points to 2.44% and 7.9 points to 2.86% respectively at the close.

OIL

Oil prices fall as markets try to digest US inflation data, Washington’s decision to draw more from strategic crude reserves and OPEC’s hike in its demand forecast for this year .

Brent fell 1.8% to 85.05 dollars a barrel and US light crude (West Texas Intermediate, WTI) fell 1.87% to 78.64 dollars.

TO BE FOLLOWED ON WEDNESDAY:

THE MARKET SITUATION:

(Some data may show a slight shift)

THE FENCE IN

EUROPE

Indices Last Var. Var. %YTD

Points

Eurofirst 300 1824.43 +1.42 +0.08% +8.70%

Eurostoxx 50 4238.76 -2.60 -0.06% +11.73%

CAC 40 7,213.81 +5.22 +0.07% +11.43%

Dax 30 15,380.56 -16.78 -0.11% +10.46%

FTSE 7953.85 +6.25 +0.08% +6.74%

SMI 11231.91 +22.57 +0.20% +4.68%

The values ​​to follow

Paris and Europe:

[WATCH/LFR]

THE TREND TO

WALL STREET

Indices Last Var. Var. %YTD

Points

Dow Jones 33980.51 -265.42 -0.78% +2.51%

S&P 500 4114.22 -23.07 -0.56% +7.16%

Nasdaq 11842.63 -49.16 -0.41% +13.15%

Nasdaq 100 12459.30 -43.02 -0.34% +13.89%

Minutes of the meeting at

Wall Street: [.NFR]

“The Day Ahead” – Update on the

next session on Wall Street [DAY/US]

CHANGES

Standby Price Var.% YTD

Euro/Dlr 1.0726 1.0720 +0.06% +0.22%

DLR/Yen 133.07 132.40 +0.51% +1.49%

Euro/Yen 142.76 141.98 +0.55% +1.75%

Dlr/CHF 0.9219 0.9192 +0.29% -0.27%

Euro/CHF 0.9889 0.9858 +0.31% -0.06%

Stg/Dlr 1.2167 1.2135 +0.26% +0.58%

Index $ 103.3510 103.3450 +0.01% +7.46%

GOLD

Var. %YTD

Gold Spot 1849.79 1853.39 -0.19% +21.94%

RATE

Last Var. Spread/Bund

(pts)

Future Bunds 135.17 -0.67

10-year Bunds 2.44 -0.01

Bund 2 years 2.85 -0.01

10-year OATs 2.90 -0.01 +46.00

10-year Treasury 3.78 +0.07

Treasury 2 years 4.62 +0.09

OIL

Previous Price Var. Var.% YTD

US light crude 78.79 80.14 -1.35 -1.68% +28.72%

Brent 85.19 86.61 -1.42 -1.64% +29.02%

(Written by Claude Chendjou, edited by Jean Terzian)

Copyright © 2023 Thomson Reuters