by Laetitia Volga

PARIS (Reuters) – European stock markets ended down moderately on Friday at the end of a session again placed under the sign of caution before the announcements of the two largest central banks in the world next week.

In Paris, the CAC 40 lost 0.12% to 7,213.14 points. Britain’s Footsie fell 0.49% and Germany’s Dax 0.25%.

The EuroStoxx 50 index lost 0.18%, the FTSEurofirst 300 0.21% and the Stoxx 600 0.15%.

At the time of the European close, the three major Wall Street indices rose after an opening in scattered order.

The Dow Jones gained 0.2%, the S&P-500 0.35% and the Nasdaq Composite 0.53%. The latter two reached their highest level of the year, supported by the progress of Tesla (+5.24%), which is benefiting from a new partnership – this time with the giant General Motors – on its charging network.

The European market remained more cautious before a busy week with the publication of consumer prices in the United States on Tuesday, on the eve of the Federal Reserve’s monetary policy announcements.

The scenario – hoped for – of a pause by the US central bank in its rate hikes is favored by a majority of observers, even if the possibility of a new increase is not excluded.

The Bank of Canada’s and Bank of Australia’s unexpected rate hikes “have created a bit of intrigue about the Fed,” said Brian Daingerfield, macro strategist at NatWest. “The Fed has very clearly steered the market in the direction of a pause…but the market expects its rhetoric to be quite hawkish.”

Other monetary policy meetings will punctuate the coming week: the Governing Council of the European Central Bank meets on Thursday, that of the Bank of Japan on Friday, but investors have fully integrated the scenario of a rise in a quarter point rate for the ECB and a status quo for the BoJ.

VALUES

British chemicals group Croda fell 12.45% to its lowest level in nearly three years after an annual pre-tax profit forecast fell short of expectations.

In its wake, the sector index lost 1.97%; Bayer, BASF, Givaudan and Symrise fell 1.54% to 4.34%.

Vivendi lost 2.35% after announcing its forthcoming exit from the CAC 40, which will include Edenred (+0.66%).

Dassault Systèmes fell 2.51%, due to a slightly worse than expected medium-term net profit per share target and, on the SBF 120 side, Scor gained 6.13%, the group having announced that Augustin de Romanet assumed the interim of his presidency following the death of Denis Kessler.

In Milan, Monte dei Paschi dropped 10.8%, rival BPER Banca (-1.96%) saying it was not at all interested in a merger with the Tuscan establishment.

RATES/EXCHANGES

Bond yields on both sides of the Atlantic pared their gains as data releases in Canada signaled an easing in the job market.

The ten-year German ended the day stable, close to 2.378%, and its American equivalent appears at 3.7491%, against a peak in session at 3.78%.

At foreign exchange, the dollar appreciated by 0.18% against other major currencies, including the euro, which fell to 1.0747.

OIL

The oil market is evolving without a clear direction, between fears for crude oil demand and the upcoming reduction in Saudi production.

Brent rose 0.14% to 76.07 dollars a barrel and US light crude (West Texas Intermediate, WTI) dropped 0.04% to 71.26 dollars.

(Laetitia Volga, edited by)

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