by Claude Chendjou

PARIS (Reuters) – The main European stock markets, apart from London, are expected to fall on Wednesday at the opening before the publication of several economic indicators in Europe and the United States while investors were cooled the day before by a statistic in the American labor market.

Index futures suggest a decline of 0.22% for the CAC 40 in Paris, 0.11% for the Dax in Frankfurt, 0.23% for the EuroStoxx 50. The FTSE 100 in London could pick up 0.05% at opening.

After PMI data on manufacturing activity in the euro zone, published on Monday, which showed a further contraction in March, as households reduced their consumption expenditure with the increase in the cost of living, investors will take note on Wednesday of the figures composite PMIs in the euro zone and the United Kingdom.

In the United States, the ISM services index for the month of March is expected at 14:00 GMT, while the monthly survey of the private firm ADP on employment should provide new elements on the evolution of the labor market before Friday’s release of the official Labor Department jobs report. The latter said on Tuesday, as part of the “Jolts” survey, that job offers fell in February to 9.9 million, their lowest level in nearly two years.

This latest statistic, which comes on top of the decline in the ISM manufacturing index for the month of March in the United States, published on Monday, reinforces fears of recession, while inflation could be revived by the rise in oil prices after the OPEC+ decision to cut production.

Futures contracts, however, suggest that the US Federal Reserve (Fed) is unlikely to raise interest rates any further and may even lower them by more than 60 basis points this year.

AT WALL STREET

The New York Stock Exchange ended lower on Tuesday following macroeconomic indicators fueling fears of recession in the United States.

The Dow Jones index fell 0.59% to 33,403.04 points.

The broader S&P-500 lost 0.58% to 4,100.68 points.

The Nasdaq Composite fell for its part by 0.52% to 12,126.33 points.

The banking sector further weakened after JPMorgan Chase Chief Executive Jamie Dimon warned in a letter to shareholders that the US banking sector crisis was still ongoing and its impact would be felt for years. Bank of America and Wells Fargo fell by more than 2%.

Caterpillar, considered a stalwart of the industrial sector, fell 5.4%, while Virgin Orbit Holdings plunged more than 23% after filing bankruptcy papers.

IN ASIA

On the Tokyo Stock Exchange, the Nikkei index fell 1.68% to 27,811.69 points and the broader Topix fell 1.84% to 1,985.46 points as the close approached.

In terms of macroeconomic statistics, service activity in Japan grew in March at its highest rate in more than nine years (55.0 after 54.0 in February) but that of factories continues to show a contraction, show the PMI data released Wednesday.

In China, the Shanghai SSE Composite took 0.49% and the CSI 300 gained 0.31%, while the MSCI index comprising stocks from Asia and the Pacific (excluding Japan) fell by 0.28%.

CHANGES

The dollar climbed 0.02% against a basket of benchmark currencies but remained at a two-month low after weak recent US economic data.

The euro was stable at 1.0951 dollars (-0.01%) after hitting a two-month peak the day before at 1.0973 dollars, thanks in particular to the surprise strength of German exports, which plead for further increases in European Central Bank (ECB) rate.

The New Zealand dollar rose 1% to 0.6383 US dollars, a two-month high, after the central bank of New Zealand (RBNZ) unexpectedly decided to raise its benchmark rate by 50 basis points to 5.25%, the highest in 14 years, while the Reuters consensus forecast an increase limited to 25 basis points.

RATE

Yields on ten-year and two-year U.S. Treasuries rose slightly on Wednesday, to 3.3498% and 3.8623% respectively after declines of 9 basis points and 14 points the previous day linked to lower bids. jobs in the United States.

OIL

Oil prices continue to benefit from OPEC+’s decision to cut production. Crude stocks in the United States also fell by about 4.3 million barrels last week, sources said. The Energy Information Administration report will be released at 2:30 p.m. GMT.

Brent rose 0.55% to 85.41 dollars a barrel and US light crude (West Texas Intermediate, WTI) 0.51% to 81.12 dollars.

(Written by Claude Chendjou, edited by Bertrand Boucey)

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