PARIS (Reuters) – Wall Street is expected to be hesitant on Monday, while European stock markets rose, supported by announcements of support from the Chinese government for its economy, even as economic indicators signal that the European economy is slowing.

New York index futures suggest a mixed opening on Wall Street, with the Dow Jones losing 0.07%, while the Standard & Poor’s 500 stagnated and the Nasdaq gained 0.27%.

In Paris, the CAC 40 advanced by 0.21% to 7,442.61 points around 10:40 GMT, while the FTSE in London gained 0.07%. The Dax in Frankfurt advances by 0.09%.

The pan-European FTSEurofirst 300 index rose 0.27%, against 0.23% for the EuroStoxx 50 and 0.25% for the Stoxx 600.

The Politburo, which brings together the most important Chinese political leaders, met on Monday and promised new measures to support an economy which is struggling to restart after the pandemic.

“The results of the Politburo meeting were greeted with a surge of optimism from market participants, but it will be necessary to monitor the situation closely to know if the new stimulus measures will be sufficient to support a recovery of the Chinese economy during the second half, warn the strategists of MUFG.

Optimism dominates in Europe, despite weaker than expected economic data.

In Germany, the IFO business climate index deteriorated in July for the third month in a row, while the European Central Bank (ECB) lending survey showed demand for new business loans hit an all-time low.

These bad data should not however influence the decision of the ECB expected on Thursday, the markets continuing to consider a rate hike certain.

THE VALUES TO FOLLOW IN WALL STREET

Quarterly results from General Motors, Verizon and 3M are due Tuesday.

Spotify Technology fell in pre-market trading after announcing a price hike ahead of its quarterly earnings release on Tuesday.

VALUES TO FOLLOW IN EUROPE

In Paris, Dassault Systèmes is at the bottom of the CAC 40, down 3.03%, the group having announced that its annual objective would be difficult to achieve.

Elior fell 7.33%, the worst performance in the SBF120, after announcing that it was lowering its EBITDA margin target for 2023.

Conversely, Logitec rose 5.86% after raising its forecast for the first half and exceeding analysts’ expectations for its results in the first quarter. Orpea announced in a press release that the Nanterre commercial court had validated its accelerated safeguard plan on Monday, which supported the group which rose to the top of the SBF 120, progressing by 5.77%.

Rémy Cointreau confirmed on Tuesday that it expects a rebound in its growth in the second half, after reporting a sharp drop in turnover for the first six months of the year, as expected, which pushed the share up by 4.09%.

The Chinese announcements supported the commodities sector, which posted the best sector performance of the Stoxx 600, up 3.52%.

RATE

Rates are rising on both sides of the Atlantic ahead of Fed and ECB monetary policy meetings, with European yields rising more moderately after disappointing activity data.

The German ten-year yield increased by 2.5 bp to 2.415%, that of the two-year rate gained 2.1 bp to 3.204%.

The ten-year Treasury yield rose 3.9 bp to 3.8963%, compared to 3.5 bp to 4.8744% for the two-year.

CHANGES

The dollar strengthened ahead of the Fed’s next meeting on Wednesday, while the euro weakened after disappointing economic indicators.

The dollar advanced 0.11% against a basket of benchmark currencies, while the euro lost 0.16% to 1.1044 dollars.

The pound rose 0.07% to $1.2841.

OIL

Oil hesitates despite announcements of support for the Chinese economy, with European data weighing on sentiment.

Brent remains at 82.71 dollars a barrel, close to its highest level since April, the American light crude (West Texas Intermediate, WTI) stagnating at 78.71 dollars.

(Report Corentin Chapron)

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