by Claude Chendjou
PARIS (Reuters) – Wall Street is expected to fall on Tuesday and European stock markets are also on the defensive mid-session in a market where a wait-and-see attitude prevails before the publication of monthly data on US inflation while results from companies judged to be disappointing hardly encourage risk-taking.
Futures on New York indices signal an opening on Wall Street down 0.43% for the Dow Jones, 0.42% for the Standard & Poor’s 500 and 0.54% for the Nasdaq.
In Paris, the CAC 40 fell by 1.06% to 7,361.72 points around 12:45 GMT. In Frankfurt, the Dax dropped 0.41% and in London, the FTSE lost 0.44%.
The pan-European FTSEurofirst 300 index fell by 0.75%, the EuroStoxx 50 of the euro zone by 0.94% and the Stoxx 600 by 0.82%.
Main macroeconomic meeting of the week, investors await Wednesday the figures of consumer prices (CPI) in the United States, which would confirm or invalidate the scenario of a pause in the rise in rates and the prospect of a soft landing for the economy.
“The market really doesn’t know if it will be a ‘hard landing’ or a ‘soft landing’,” notes Giles Coghlan, analyst at HYCM, saying he expects a less restrictive policy from the US Federal Reserve ( Fed), which should weaken the dollar and help equity markets.
In Europe, where German inflation figures will also be released on Wednesday, European Central Bank Governing Council member Peter Kazimir said on Tuesday that the ECB may have to raise rates for longer than expected. The Bank of England (BoE), for its part, holds its monetary policy meeting on Thursday.
WALL STREET VALUES TO FOLLOW
Cosmetics and fragrances group COTY gained 2% as it raised its annual profit target again, while Paypal Holdings fell 5% in out-of-hours trading after the payments group lowered its adjusted operating margin forecast for this year. The sports equipment manufacturer Under Armor for its part yielded 2.5% in pre-market after the publication of annual sales and profit forecasts below expectations.
VALUES IN EUROPE
On the stock market, a large part of the pan-European Stoxx 600 compartments is in the red, the most marked drop being for real estate, which fell by 2.26%. In Paris, Unibail Rodamco yields 1.19% and Icade 2.37% in the wake of a new plunge, of 13.54%, by SBB. The Swedish real estate group announced on Monday a suspension of the dividend paid to shareholders and the cancellation of a capital raising after the lowering of its credit rating by S&P Global from BBB- to BB+.
Luxury stocks are also neglected due to a Chinese economic indicator which shows a surprise drop in imports and a slightly smaller than expected increase in exports. Kering, Hermès, Richemont, Moncler lost 1.53% to 2.60%.
In corporate financial publications, the British insurer fell 5.84% after saying it expected profit pressure this year, while Dutch fertilizer producer OCI lost 5.48% after lower Ebitda. expectations for the first quarter.
On the upside, Banco BPM jumped 4.52% as it raised its profit target for 2023 and 2024, while Fresenius Medical Care rose 1.31% as the German dialysis specialist announced a lower decline. sharper than expected in its quarterly adjusted operating income.
Excluding results, JD Sports, which wants to buy the shoe distributor Courir, advances by 1.26%.
RATE
Yields on government bonds fell on the eve of the publication of inflation figures in the United States and Germany: that of ten-year Treasuries fell just over three basis points, to 3.49%, and its German equivalent around two points, at 2.312%.
CHANGES
The dollar rises 0.21% against a basket of benchmark currencies as traders await fresh data on prices in the United States and the meeting scheduled for the day between President Joe Biden and Republican officials in Congress in subject of the debt ceiling, which would clarify the economic outlook.
The euro, down 0.36%, is trading at 1.0964 dollars.
OIL
Oil prices mark a break on Tuesday after their sharp rise the day before linked to the ebb of fears of a recession following the publication of the monthly US employment report on Friday.
Brent fell 1% to 76.24 dollars a barrel and US light crude (West Texas Intermediate, WTI) 1.07% to 72.38 dollars.
(Written by Claude Chendjou, edited by Kate Entringer)
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