by Claude Chendjou
PARIS (Reuters) – European stock markets ended lower on Tuesday and Wall Street was also in the red at the end of the morning in New York, the indices being affected by expectations of rising interest rates, geopolitical tensions and forecasts companies.
In Paris, the CAC 40 ended down 0.37% at 7,308.65 points. The British Footsie lost 0.46% and the German Dax lost 0.52%.
The EuroStoxx 50 index fell by 0.49%, the FTSEurofirst 300 by 0.2% and the Stoxx 600 by 0.19%.
Three days before the first anniversary of the outbreak of war in Ukraine, Vladimir Putin on Tuesday accused NATO and the West of stoking the conflict and announced that Moscow was suspending its participation in the New Start treaty on strategic nuclear weapons, a decision regretted in particular by the Secretary General of NATO, Jens Stoltenberg, and France.
On the macroeconomic level, the dynamism of services supported the growth of activity in February in the euro zone and the United Kingdom, allowing the “flash” composite indices to stand out well above the 50 mark, marking an expansion.
For analysts at Oddo BHF, these statistics, which reinforce the resistance of the European economy, at the same time fuel fears of prolonged monetary tightening.
In the United States, economic activity also rebounded in February, to its highest level in eight months, according to PMIs, again confirming the prospect that demand is not slowing enough, so that the markets are currently pricing in three additional US Federal Reserve rate hikes in March, May and June.
VALUES
The prospect of monetary tightening benefited the European banking sector, whose index gained 0.82%, while new technologies (-1.48%) and real estate (-1.79%), sensitive to rate hikes, saw the two largest declines in the Stoxx 600.
In individual values, Capgemini lost 2.77%, the group anticipating weaker growth in turnover this year.
Engie jumped 4.82% on the back of its annual results, which were supported by rising gas prices.
Elsewhere in Europe, HSBC took 4.31% after quarterly profit beat expectations.
AT WALL STREET
At the time of the close in Europe, the Dow Jones fell 1.62%, the Standard & Poor’s 500 1.64% and the Nasdaq 2.04%, the indices being affected mainly by the forecasts of Walmart and Home Depot . Both retailers warned of a slowdown in demand this year amid high inflation.
Their competitors Target, Macy’s and Costco Wholesale are in the red, while the retail index fell by 0.37%.
The rise in bond yields is weighing on Apple, Amazon, Microsoft and Alphabet, which fell from 1.83% to 2.79%.
THE INDICATORS OF THE DAY
Home resales in the United States fell in January to their lowest level in more than 12 years but at a slower pace than previously, which fuels cautious optimism in the sector.
Investor sentiment in Germany continued to improve in February, more strongly than expected, shows the survey of the institute for economic studies ZEW.
CHANGES
The dollar rose 0.23% against a basket of benchmark currencies, driven by macroeconomic data which reinforces the prospect of a new monetary tightening.
The euro lost 0.26% to 1.0654 dollars.
RATE
PMI indices supported bond yields. That of the two-year German Bund took six basis points, to 2.95%, the highest in 14 years. The ten-year Bund yield gained almost eight points, to 2.53%, after hitting a session high since August 2011 at 2.569%.
The two-year UK Gilt rate has peaked since October at 3.92%.
In the United States, the yields of two-year and ten-year Treasuries are respectively 4.70% (+8 points) and 3.91% (+8.6 points).
OIL
Oil prices fall with the rise of the dollar and fears over rates which could weigh on demand: Brent falls 1.64% to $82.69 a barrel and US light crude (West Texas Intermediate, WTI) loses 0.12% to $76.25.
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 1831.43 -3.66 -0.20% +9.12%
Eurostoxx 50 4250.40 -20.78 -0.49% +12.04%
CAC 40 7,308.65 -26.96 -0.37% +12.90%
Dax 30 15,397.62 -79.93 -0.52% +10.59%
FTSE 7977.75 -36.56 -0.46% +7.06%
SMI 11282.16 +15.48 +0.14% +5.15%
The values ​​to follow in Paris and in
Europe: [WATCH/LFR]
THE TREND TO
WALL STREET
Indices Last Var. Var. %YTD
Points
Dow Jones 33247.84 -578.85 -1.71% +0.30%
S&P 500 4009.11 -69.98 -1.72% +4.42%
Nasdaq 11541.82 -245.46 -2.08% +10.27%
Nasdaq 100 12116.66 -241.53 -1.95% +10.76%
Minutes of the session on Wall
Street: [.NFR]
“The Day Ahead” – Update on the next session
on Wall Street [DAY/US]
CHANGES
Standby Price Var.% YTD
Euro/Dlr 1.0655 1.0682 -0.25% -0.44%
DLR/Yen 134.87 134.23 +0.48% +2.87%
Euro/Yen 143.74 143.46 +0.20% +2.45%
DLR/CHF 0.9266 0.9234 +0.35% +0.24%
Euro/CHF 0.9875 0.9861 +0.14% -0.18%
Stg/Dlr 1.2101 1.2038 +0.52% +0.04%
Index $ 104.0980 103.8580 +0.23% +8.24%
GOLD
Var. %YTD
Gold Spot 1833.50 1841.14 -0.41% +20.86%
RATE
Last Var. Spread/Bund
(pts)
Future Bunds 134.11 -0.75
10-year Bunds 2.53 -0.01
Bund 2 years 2.95 -0.00
10-year OATs 3.02 -0.01 +48.40
10-year Treasury 3.91 +0.09
Treasury 2 years 4.70 +0.08
OIL
Previous Price Var. Var.% YTD
US light crude 76.25 76.34 -0.09 -0.12% +24.57%
Brent 82.70 84.07 -1.37 -1.63% +25.25%
(Written by Claude Chendjou, edited by Kate Entringer)
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I have over 8 years of experience working in the news industry. I have worked as a reporter, editor, and now managing editor at 247 News Agency. I am responsible for the day-to-day operations of the news website and overseeing all of the content that is published. I also write a column for the website, covering mostly market news.
