by Claude Chendjou

PARIS (Reuters) – Wall Street is expected to rise slightly and European stock markets are moving in small mid-session variations in a bid for cautious optimism in the markets with the first quarterly results of companies and pending new elements on the path of central bank interest rates. Futures on New York indices signal an opening of Wall Street up 0.16% for the Dow Jones and 0.13% for the Standard & Poor’s 500, while the Nasdaq is expected to be stable. In Paris, the CAC 40 lost 0.09% to 7,512.66 around 12:10 p.m. GMT after hitting a new record in the morning at 7,552 points. In Frankfurt, the Dax fell by 0.1%. In London, the FTSE takes however 0.23%.

The pan-European FTSEurofirst 300 index climbed 0.03%, but the eurozone’s EuroStoxx 50 fell 0.34%, while the Stoxx 600 slid 0.08%.

The cautious appetite for risk is notably fueled by the quarterly profits published Friday by Citigroup, JPMorgan Chase & Co and Wells Fargo & Co, which emerged above expectations, while Tuesday Goldman Sachs and Bank of America will announce their financial accounts. The market is also expecting releases from Netflix, Tesla, IBM and Procter & Gamble, among others, this week.

In Europe, the luxury sector, which benefited from the solid results of LVMH and Hermès, is awaiting the accounts on Friday from Kering.

“Cautious optimism is the leitmotif of Monday’s rise as stronger-than-expected data from U.S. businesses and signs of consumer resilience help mask lingering concerns about the impact of high interest rates,” explains Susannah Streeter, head of foreign exchange and financial markets at Hargreaves Lansdown.

Two officials of the American Federal Reserve (Fed) John Williams and Loretta Mester are due to speak during the week and a speech by Christine Lagarde, the President of the European Central Bank (ECB), is also expected, while will be published alongside new data on inflation in March and figures for activity in the manufacturing and services sectors in April in the euro zone.

VALUES IN EUROPE

Among the major compartments of the European stock exchange, the basic resources sector (+1.28%) posted the best progress as the Chinese economy should have grown in the first quarter at its fastest pace for a year, according to the Reuters consensus on China’s GDP expected on Tuesday.

In individual stocks, mergers and acquisitions are driving the exchanges. Network International jumped 18.81% after receiving a takeover offer from a consortium led by CVC Capital and Francisco Partners, which is pulling the entire electronic payments sector with Worldline taking 3.32% and Nexi 2 in particular, 74%.

In video games, Rovio Entertainment, publisher of Angry Birds, soared 17.75% thanks to an offer of 706 million euros from the Japanese group Sega on its Finnish competitor.

British oil and gas services specialist John Wood Group advances 6.89% after announcing an engagement with US private equity group Apollo Global Management to buy it for around 1.66 billion pounds (1.87 billion euros).

In Paris, Airbus (+1.20%) and Air France (+0.80%) are in the green after their release from charges of manslaughter in the crash in 2009 of the Rio de Janeiro-Paris link, which kills 228.

CHANGES

The dollar rebounded slightly, 0.11%, against a basket of benchmark currencies after falling to a one-year low on Friday.

The greenback is advancing to a one-month high against the yen at 134.22 yen to the dollar, buoyed by expectations of a 25 basis point Fed rate hike in May as the Bank of Japan (BoJ ) sticks to an ultra-loose policy.

The euro is trading at 1.098 dollars, down 0.17%.

RATE

On bonds, the ten-year German Bund yield hit a one-month high on Monday, at 2.472% from 2.431% on Friday, as the market values ​​the peak in the ECB deposit rate at 3.75% .

In the United States, the yield on Treasuries stands at 3.547% (+2 basis points).

OIL

Oil prices fell slightly ahead of Chinese statistics scheduled for Tuesday: Brent fell 0.57% to 85.82 dollars a barrel and US light crude (West Texas Intermediate, WTI) 0.63% to 82 dollars.

(Written by Claude Chendjou, edited by Matthieu Protard)

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