by Laetitia Volga

PARIS (Reuters) – Wall Street is expected to open slightly higher on Wednesday, reducing its losses from the previous day, and European stock markets are hesitating mid-session, with fears of a possible default by the world’s largest economy. Futures on New York indices signal an opening up 0.43% for the Dow Jones, 0.36% for the Standard & Poor’s-500 and 0.2% for the Nasdaq.

On Tuesday, these three indices lost ground after poor forecasts from Home Depot, less sustained growth than expected in retail sales and fears over the thorny issue of US debt. In Paris, the CAC 40 lost 0.02% to 7,404.66 around 11:20 GMT. In Frankfurt, the Dax gained 0.42%, driven by the rise in Siemens and SAP, while in London, the FTSE lost 0.05%.

The pan-European FTSEurofirst 300 index lost 0.01%, the Eurozone EuroStoxx 50 advanced 0.17% and the Stoxx 600 fell 0.06%.

The latest round of talks on the US debt ceiling on Tuesday failed to find a compromise between Republicans and Democrats. Nonetheless, Joe Biden and House of Representatives Speaker Kevin McCarthy spoke of a productive meeting, with the Republican ‘speaker’ even adding that a deal could be reached by the end of the week. .

Officials such as Treasury Secretary Janet Yellen have warned that the United States could be in default as early as next month if the standoff between the two camps lasts.

“Stocks could be range bound until a deal is found, the biggest downside risk could come if we enter the Memorial Day long weekend with no solution,” analysts said. JPMorgan. WALL STREET VALUES TO FOLLOW

Target fell slightly ahead of the market after saying it expected lower-than-expected earnings and lower sales in the second quarter, due to the impact of inflation on customers.

VALUES IN EUROPE

On the stock market, Elior stands out with a fall of 20.9%, the collective catering group having lowered its margin forecast.

Ubisoft, which suffered the largest operating loss in its history in the 2022-2023 financial year, dropped 1.1%.

In the green, Vallourec advances by 6.4% after the publication of quarterly sales growth of 46%.

Commerzbank fell 6.11% due to an annual net profit target below expectations.

Also in Frankfurt, SAP gained 1.62% after raising its revenue forecast for 2025 and announcing a 5 billion euro share buyback program while Siemens won 2.54% after also revised its annual outlook upwards.

EXCHANGES The dollar continues to rise, benefiting from its status as a safe haven in the face of the risk of a default in payment by the United States and the prospect of high interest rates for a long time.

Several Fed officials, Austan Goolsbee and Loretta Mester, have indeed dismissed the prospect of a rate cut this year.

Against a basket of benchmark currencies, the greenback gained 0.33%. The euro, 1.0835, fell to its lowest since early April.

RATES After three sessions of increases, the yields on government bonds in the euro zone are trending downwards before a series of auctions in several countries of the region (France, Germany, Belgium).

That of the ten-year German fell by three basis points to 2.309% and its French equivalent was displayed at 2.893% against 2.937% at the end of the day on Tuesday.

In the United States, the yield on ten-year Treasuries fell two points to 3.5282%.

OIL

Oil prices are up moderately, with the prospect of a tighter supply this year.

Brent gained 0.32% to $75.15 a barrel and US light crude (West Texas Intermediate, WTI) 0.35% to $71.11.

NO MORE MAJOR ECONOMIC INDICATOR ON TODAY’S AGENDA

(Laetitia Volga, editing by Kate Entringer)

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