(News Bulletin 247) – The Paris Stock Exchange is expected to rise slightly on Tuesday morning following a further easing of Chinese monetary policy, even if this increase should take place in reduced trading volumes on this public holiday. Assumption.
Around 8:15 a.m., the ‘future’ contract on the CAC 40 index – delivery at the end of August – rose 24 points to 7377.5 points, announcing a start to the session in the green.
As the country’s economic recovery stalled, the People’s Bank of China (PBOC) cut the interest rate on its medium-term credit facility for the second time in three months.
This news was greeted without enthusiasm by investors, who know that this measure comes in the wake of indicators below expectations, which came to revive concerns about the growth of the second largest economy in the world.
In terms of activity, Chinese industrial production saw its
growth decelerate to +3.7% over one year in July, while economists were forecasting an average increase of 4.4%.
Retail sales, up just 2.5% year on year last month, also came in below consensus.
Following these statistics, the SSE Composite index of the Shanghai Stock Exchange yielded 0.1% at the end of the session, while in Hong Kong, the Hang Seng dropped 0.8%.
Investors are now waiting, in the early afternoon, for the publication of data on retail sales in the United States in order to gauge the evolution of American consumption, which is resisting much better.
These figures should indeed show an acceleration in the increase in purchases by Americans, to +0.4% last month, after that of 0.2% recorded in June.
A good surprise would certainly confirm the solidity of the economic situation in the United States, but it could also provide the Federal Reserve with ammunition to continue raising its rates.
On the bond side, the yield of ten-year Treasuries continues to camp above 4.18%, a sign that investors expect the Fed to go higher and longer in its tightening cycle.
Investors will also look at the ZEW index measuring investor sentiment in Germany, expected late morning, then the quarterly results of the American home renovation giant, Home Depot, expected at midday.
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