(News Bulletin 247) – The Paris Stock Exchange should open slightly higher on Tuesday morning following the publication of an encouraging Chinese indicator, which has allayed fears of a global recession.

Around 8:15 a.m., the ‘future’ contract on the CAC 40 index – April delivery – rose nine points to 7,511.5 points, announcing a timid rebound after the limited decline (-0.3%) the day before.

China’s gross domestic product (GDP) grew 4.5 percent year on year in the first quarter of 2023, according to data released by the National Bureau of Statistics (NBS) on Tuesday.

On a monthly basis, the Chinese economy grew by 2.2% during the first three months of the year, where analysts were only expecting an increase of 2%.

“China’s national economy has seen a good start this year,” said BES spokesperson Fu Linghui at a press conference.

These figures suggest that the Chinese economy is doing better after having long suffered from containment measures in the country, mainly under the impetus of the rebound in household consumption, react this morning the teams of Danske Bank.

The announcement of Chinese growth exceeding expectations is above all likely to calm investors’ concerns about the slowdown in growth.

Another supportive factor, the rebound for European stock markets comes in the wake of the recovery operated Monday by Wall Street, where the Dow Jones ended on gains of around 0.3%, like the Nasdaq.

The trend in New York was supported by defensive stocks, starting with real estate which rose more than 2.2% at the final bell in a context of rising bond yields.

Small reason for relief, the ten-year Treasuries rate stabilizes around 3.59% this morning

Despite the continuous deterioration in bond prices over the past four weeks, the stock markets are still buoyed by growing optimism around the scenario of a ‘soft landing’, which would see inflation recede without necessarily resulting in an entry into recession.

A scenario reinforced yesterday by the spectacular rebound of the Empire State index measuring activity in the manufacturing sector in the New York region, which stood at +10.8 in April against -24.6 in March.

Regarding the economic agenda of the day, investors will follow in the morning the ZEW index of investor sentiment in Germany, expected to improve in April.

Still on the macroeconomic level, the participants will learn, at the start of the afternoon, of the figures for building permits and housing starts in the United States, which had rebounded strongly in February.

Investors will also keep their eyes riveted on corporate results, with publications from Ericsson then Johnson & Johnson, Goldman Sachs and Bank of America, which will precede the Netflix accounts expected this evening.

Quarterly corporate earnings will be closely watched to see if their outlook is suffering too much from growing uncertainty about the strength of the economy.

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