by Claude Chendjou

PARIS (Reuters) – European stocks ended higher on Monday and Wall Street was also in the green mid-session on the back of bargain buying after the worst week since the start of the year for equity markets amid concerns about a prolonged rise in central bank interest rates.

In Paris, the CAC 40 ended with a gain of 1.51% to 7,295.55 points. Britain’s Footsie gained 0.72% and Germany’s Dax gained 1.13%.

The EuroStoxx 50 index rose by 1.66%, the FTSEurofirst 300 by 1.13% and the Stoxx 600 by 1.07%.

While US Federal Reserve (Fed) Chairman Jerome Powell said earlier this month that the process of disinflation had begun, the US PCE price index, released on Friday, showed a surprise acceleration in January.

This statistic, which is added to other data showing a still tight labor market and a resistance of economic activity in the United States, has led the NatWest and Barclays banks to now expect a 50-point increase. Fed rate base in March.

In Europe, where the risk of recession has also receded according to the latest statistics, Christine Lagarde, President of the European Central Bank (ECB) repeated in an interview with The Economic Times that a rise in interest rates of 50 points was to be expected in March and that everything would be done to bring inflation back towards the 2% target.

VALUES IN EUROPE

The renewed appetite for risk in Europe mainly benefited the sectors of energy (+1.37%), basic resources (+0.92%), new technologies (+1.68%) and automotive (+1.41%).

In these last two compartments, Worldline (+2.27%), Michelin (+2.73%) and Renault (+2.79%) stood out on the CAC 40.

Elsewhere in Europe, the return of Commerzbank (+4.55%) to the Dax index was welcomed, while in the retail sector (+1.95%), AB Foods, owner of Primark, gained 1 44% after raising its forecasts, and Hennes & Mauritz 4.21%, thanks to BofA’s recommendation to “buy” on the Swedish group.

AT WALL STREET

At the time of the close in Europe, the Dow Jones advanced by 0.22%, the Standard & Poor’s 500 by 0.46% and the Nasdaq by 0.83%.

For Sam Stovall, investment strategist at CFRA Research, today’s rebound has to do with “the market being so down last week” as the Dow Jones erased all of its gains since the start of the trading on Friday. the year.

In values, Tesla took 4.38%, the automaker having announced an acceleration of production at its Berlin factory, while the manufacturer of electric vehicles Fisker jumped 30.98% thanks to an increase in its orders.

On the downside, Pfizer fell 1.53%, the laboratory being in discussions to buy Seagen (+9.26%) according to the Wall Street Journal, an operation valued at several billion dollars.

THE INDICATORS OF THE DAY

Business credit growth in the euro zone slowed in January for the third consecutive month, to 6.1%, according to the ECB.

CHANGES

The dollar is back from a nearly seven-week peak, yielding 0.38% against a basket of international currencies. The note took almost 3% in February.

The euro, for its part, fell Monday in session to 1.053 dollars, its lowest level since January 6, before rising to 1.0593 (+0.46%).

The pound sterling is trading at 1.2025 dollar (+0.72%) and 0.8807 euro (+0.27%) after the announcement of an agreement between London and the EU on the Northern Irish protocol which has been poisoning their trade relations since Brexit.

RATE

The ten-year German Bund yield touched a peak since July 2011 at 2.591% on Monday before reducing its closing gains to 2.58% (+5.8 basis points). The two-year-old ended at 3.06% (+5.1 points), the highest since 2008.

In the United States, the yields of these two maturities, which rose sharply on Friday, are on the other hand slightly down, respectively at 3.92% and 4.80%, due to the contraction more important than expected, from 4. 5%, durable goods orders in January published on Monday.

OIL

Oil prices are falling due to the strength of the dollar, but Russia’s decision on Saturday to suspend its crude oil exports to Poland via the Druzhba pipeline, Warsaw having delivered its first Leopard tanks to Ukraine the day before, limits the extent of the decline.

Brent fell 1.08% to 82.26 dollars a barrel and US light crude (West Texas Intermediate, WTI) 0.94% to 75.6 dollars.

(Written by Claude Chendjou)

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