by Claude Chendjou

PARIS (Reuters) – The main European stock markets are expected to have small variations at the opening on Wednesday, with investors likely to exercise caution due to offensive statements from central bankers and pending new indicators at the end of the week. economic factors such as eurozone inflation and US GDP.

According to the first indications available, the Dax in Frankfurt should gain at the opening 0.36%, the FTSE 100 in London 0.23% and the EuroStoxx 50 index 0.46%. As for the CAC 40 in Paris, it could take 0.41%.

Gathered since in Sintra, Portugal, on the occasion of the annual forum organized by the European Central Bank (ECB), the world’s big moneymakers have been multiplying speeches since Monday going in the direction of continued monetary tightening. Christine Lagarde, the president of the ECB, notably estimated that inflation in the euro zone had entered a new phase which is likely to last for some time.

In this respect, the first estimate of German inflation for the month of June, scheduled for Thursday, will be particularly watched, before that of the whole of the euro zone, expected on Friday.

In the United States, the monthly household income and expenditure statistics, which include an inflation indicator, will be published on Friday, while the final US GDP figures for the first quarter will be known on Thursday.

Two better-than-expected U.S. housing and capital goods orders data on Tuesday fueled the prospect of an extended period of high interest rates from the U.S. Federal Reserve.

Futures suggest that interest rates in the United States could rise to 5.5%-5.75%, while in the euro zone, the market is betting with a probability of 90% on a deposit rate of the ECB at 3.75% in July, before a peak around 4.0% by the end of the year.

VALUES TO FOLLOW IN EUROPE:

AT WALL STREET

The New York Stock Exchange rebounded sharply on Tuesday, buoyed by strong indicators that reassured investors about the health of the US economy despite the prospect of another rate hike from the Fed in July.

After six consecutive sessions of decline, the Dow Jones index gained 0.63%, or 212.03 points, to 33,926.74 points.

The broader S&P-500 rose 49.59 points, or 1.15%, to 4,378.41 after falling in five of the previous six sessions.

The tech-heavy Nasdaq Composite advanced 219.9 points (1.65%) to 13,555.67 points and is heading for its best first half in 40 years.

After the negative sequence of the past week, fueled by the aggressive speech of the chairman of the Fed, Jerome Powell, the trend was supported by a salvo of favorable macroeconomic indicators in the United States: in May, new orders in goods of unexpectedly increased while new home sales soared; and in June, US consumer confidence hit a near year-and-a-half high.

The positive signals for the economic situation benefited the Dow sector index of Transport (+2.7%) and the Russell 2000 index of small caps (+1.5%).

The Philadelphia index of the real estate sector (+2.99%) for its part reached a record in session.

The heavyweights of the rating carried the momentum of the day, such as Microsoft (+ 1.8%) or Apple (+ 1.5%). Meta Platforms took 3.1% after a price target increase by Citigroup.

Tesla gained 3.8% as its charging system looks set to become the standard for electric vehicles in North America.

IN ASIA

On the Tokyo Stock Exchange, the Nikkei index advanced 1.77% to 33,112.79 points and the Topix, larger, took 1.86% to 2,295.84 points as the close approached.

The MSCI index comprising stocks from Asia and the Pacific (excluding Japan) is almost stable.

In China, the Shanghai SSE Composite, on the other hand, lost 0.28% and the CSI 300 lost 0.36%.

CHANGES

The dollar rebounded slightly (+0.08%) against a basket of benchmark currencies after falling 0.24% on Tuesday. The euro is displayed at 1.0951 dollars (-0.07%) and the pound sterling at 1.2727 dollars (-0.15%)

The Japanese currency fell to 144.18, an eight-month low against the dollar before rebounding to 143.87 as a Japanese diplomat, Masato Kanda, warned on Wednesday that Tokyo would take appropriate action in the event of excessive yen weakness. .

In the bond market, the yield on ten-year US Treasury bills was stable at 3.766% after a gain of around five basis points the previous day.

OIL

Oil prices are driven by industry data showing a larger than expected drop in US crude inventories, a sign of robust consumer demand.

Brent gained 0.69% to 72.76 dollars a barrel and US light crude (West Texas Intermediate, WTI) 0.59% to 68.10 dollars.

(Written by Claude Chendjou)

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