by Laetitia Volga

PARIS (Reuters) – Wall Street is expected to open slightly higher and European stocks rose mid-session on Thursday, as signs of moderating U.S. inflation bolstered hopes that the Federal Reserve would pause in its bid hikes. interest rate. In Paris, the CAC 40 gained 0.63% to 7,407.41 at 10:28 GMT. In Frankfurt, the Dax advances by 0.13% and in London, the FTSE grabs 0.01%.

The pan-European FTSEurofirst 300 index is up 0.42%, the Eurozone EuroStoxx 50 is up 0.48% and the Stoxx 600 is up 0.45%.

The “futures” on New York indices suggest a stable opening for the Dow Jones, up 0.25% for the Standard & Poor’s-500 and 0.28% for the Nasdaq.

This ended Wednesday at its highest level in more than eight months, driven by technology stocks having benefited in particular from the sharp drop in yields on Treasury bonds after the announcement of a slowdown in US inflation at a rate annually in April. This good news makes the markets hope that the Federal Reserve opts in June for a status quo, then that it lowers its rates by a quarter of a point three times before the end of the year, shows the barometer Fedwatch. For some observers, the markets are a little too optimistic.

“The market is pricing in a rate cut as early as this summer. While inflation is decelerating, it’s not doing so at a pace that would justify a reduction in the fed funds rate target until the fourth quarter,” said Matthew Palazzolo. , senior strategist at Bernstein Private Wealth Management.

The monthly producer price data, released at 12:30 GMT, will provide investors with another opportunity to reassess the outlook for inflation and monetary policy tightening. The Reuters consensus gives them an increase of 0.3% over one month and 2.4% over one year, after +2.7% in March.

Before that, the Bank of England will be in the spotlight at 11:00 GMT. As the markets have priced in a quarter-point hike in the key rate, attention will be focused on the new economic forecasts and on the “forward guidance”.

WALL STREET VALUES TO FOLLOW

Walt Disney shares are up 5% in pre-market trading, weighing on Dow Jones futures. The entertainment giant announced that it lost four million subscribers to the Disney+ service in the first quarter.

VALUES IN EUROPE

In Paris, Engie gained 1.01% after announcing that its 2023 results should be at the top of its forecast ranges and Eiffage advanced by 1.19% after a 13.1% growth in turnover in first trimester. Dutch bank ING is up 3.58% after reporting better-than-expected quarterly profit and a new share buyback program of up to 1.5 billion euros.

Tod’s gained 3.77% as the Italian luxury group posted quarterly sales above expectations thanks to a strong performance in China.

On the other hand, Bayer gave up 6.86% after announcing a drop in its gross operating surplus that was greater than expected and that its annual results would probably be at the bottom of the expected range.

CHANGES

The “dollar index”, which follows the fluctuations of the American currency against a reference basket, is up 0.42% and the euro is back below 1.095 dollars. In China, the yuan is stabilizing after falling to its lowest level in two months against the dollar in the morning, amid growing signs of a weak economic recovery in the country. The consumer price index rose at the slowest pace in more than two years in April (+0.1%), while the decline in producer prices steepened, according to data from the National Bureau. statistics.

The pound sterling, after having posted its highest since April 2022 against the dollar, fell back on profit taking before the announcements of the BoE.

RATES The yield on ten-year Treasuries fell slightly, to 3.4196%. In Europe, the ten-year German Bund yield lost three basis points to 2.258%.

OIL

Oil prices are erasing some of the previous day’s losses, supported by the sharper-than-expected decline in US crude inventories last week (-3.2 million barrels), according to figures from the US Agency for Energy Information (EIA).

Brent gained 0.62% to $76.88 a barrel and US light crude (West Texas Intermediate, WTI) rose 0.59% to $72.99.

(Laetitia Volga, edited by Blandine Hénault)

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