PARIS (Reuters) – European stocks ended higher on Friday, reassured by a set of economic data suggesting that the tightening of monetary policy could bring inflation back to target without stifling growth.
In Paris, the CAC 40 rose 1.19% to 7,400.1 points and the German Dax gained 1.26%, while the British Footsie rose 0.80%. The EuroStoxx 50 index ended the session up 1.21%, while the FTSEurofirst 300 gained 1.03% and the Stoxx 600 1.16%.
Over the week, the CAC 40 gained 3.3%, its best weekly performance over three months, while the Stoxx 600 advanced by 1.94%.
Investors ended the week, month and quarter with better-than-expected US inflation data, reassuring markets of the effectiveness of the Federal Reserve’s monetary policy.
This slowdown is not yet to the detriment of activity, have also shown a set of data – GDP growth, employment figures and consumer confidence – which surprised on the upside.
“Once again, the U.S. economy continues to surprise macro watchers with its strength and resilience, a surprise that led global markets to reassess prices this week” and supported stocks, says Florian Ielpo, Managing Director macroeconomic research at Lombard Odier AM.
In the euro zone, the price data published on Friday also confirmed that the process of disinflation was underway in the zone, even if inflation remains above the target of the European Central Bank.
RATE
Yields fell at the close, after a volatile week: the evolution of key rate expectations led to a sharp revaluation of bond valuations.
In the United States, interest rate expectations have thus risen again, with investors now estimating the probability that the Fed will raise its rates during its next monetary policy meeting at 83.5%, and the probability that it will rise at 38%. she takes them up a second time this year.
Ten-year Treasuries yields fell 3.5 basis points to 3.8210% on strong inflation data, while 2-year sovereign yields remained stable at 4.8788%, their highest level over three months.
In Europe, the yield on ten-year German government bonds fell 1.6 basis points to 2.3970%, an increase of 1.3 basis points for the 2-year Bund to 3.2680. %.
VALUES
Private equity group Apollo made a €1.23 billion takeover bid for Applus Services on Friday, which pushed the Spanish industrial testing company’s share price up 5.8%.
Austrian bank Bawag (-3.61%) finished last in the Stoxx 600 as short seller Petrus Adviser sent a letter to the European regulator saying the bank was “unstable”.
Shares of Subsea 7 finished top of the Stoxx 600, up 12.2%, after the Norwegian offshore services provider announced a major UK contract.
The Dutch government on Friday announced new rules limiting the export of certain semiconductor equipment, which weighed on the price of ASML, the last of the Stoxx 50 with a drop of 0.81%. The real estate sector finished at the top of the Stoxx 600 and the CAC 40, up 1.39% and 2.36%, supported by the upward revision of the outlook for German developer LEG Immobilien and expectations of an imminent end. rate hikes.
AT WALL STREET
US markets showed the same optimism as European stock markets, supported by the latest inflation data that was weaker than expected.
At the close in Europe, trading on the New York Stock Exchange was up, with the Dow Jones gaining 0.63%, while the Standard & Poor’s 500 advanced 0.92%, and the Nasdaq Composite increased by 1.34%.
CHANGES
Friday’s data confirming that inflation was on a downward slope weighed on the dollar, which fell 0.42% against a basket of benchmark currencies.
Conversely, the euro is strengthening against the greenback, up 0.46% to 1.0915 dollars.
The pound sterling jumped 0.80% to 1.2712 dollars, supported by the resolutely “hawkish” posture of the Bank of England.
OIL
Oil rebounds, supported by a weaker dollar and a more encouraging outlook for the US economy.
Brent gained 0.86% to 74.98 dollars a barrel and was heading for a weekly gain, like American light crude (West Texas Intermediate, WTI) which rose 1.53% to 70.94 dollars.
(Report Corentin Chapron, edited by Kate Entringer)
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