by CORENTIN CHAPPRON
PARIS (Reuters) – Wall Street is expected to rise on Friday, while European stocks advance amid caution ahead of the Jackson Hole meeting. Futures on New York indices suggest a higher opening on Wall Street, with the Dow Jones gaining 0.3%, while the Standard & Poor’s 500 gained 0.27% and the Nasdaq 0.14%.
In Paris, the CAC 40 rose by 0.66% to 7,262.25 points around 10:55 GMT, against 0.48% for the FTSE in London and 0.47% for the Dax in Frankfurt. The pan-European FTSEurofirst 300 index gains 0.38%, against 0.59% for the EuroStoxx 50 and 0.4% for the Stoxx 600.
Caution is advised before the Jackson Hole symposium, during which Jerome Powell, the chairman of the Federal Reserve, will speak at 2:05 p.m. GMT on the state of the American economy.
Investors will be closely watching the comments of the American financier, as the US economy sends mixed signals, with leading indicators raising fears of a slowdown in activity while labor markets and consumption remain resilient.
The Fed may therefore have to raise rates again to bring inflation under control, and investors will seek confirmation that the tight monetary policy is transmitting to activity.
“The Jackson Hole symposium will give Jerome Powell an opportunity to refine his message on data dependency, and perhaps prepare investors for the likely upward revision to the Fed’s economic forecast in September,” writes Sonia Meskin, Head of Macro US at BNY Mellon Investment Management.
The National Highway Traffic Safety Administration will complete its two-year investigation into Tesla and its autopilot and may make a public announcement soon, the agency’s acting chief told Reuters.
CMC Markets tumbles 14.75% after its earnings warning.
Watches of Switzerland tumbled 23.0%, bottom of the Stoxx 600, as Rolex’s takeover of retailer Bucherer raised questions about Watches’ prospects.
JCDecaux gained 4.54%, leading the SBF120 after Deutsche Bank raised its recommendation to “buy”, citing growth opportunities offered by the Paris Olympics.
RATE
U.S. rates stagnate ahead of Jackson Hole meeting, but European yields rise after comments from Bank of Spain Deputy Governor Margarita Delgado, who warned inflation will stay high for too long, while the German business climate has deteriorated more than expected.
The German ten-year yield rose 3 bp to 2.552%, while that of the two-year rate rose 4.3 bp to 3.013%.
The ten-year Treasury yield is up 1.4 bps at 4.2492%, compared to 2.4 bps at 5.0433% for the two-year.
CHANGES
Currency markets remain calm ahead of the Jackson Hole symposium. The dollar rose 0.10% against a basket of benchmark currencies, while the euro dropped 0.11% to $1.0797, the lowest since mid-June, and the pound sterling was stable at 1 .2598 dollars.
OIL
Crude prices are firming up in anticipation of Jerome Powell’s speech.
Brent rose 1.18% to $84.34 a barrel, with US light crude (West Texas Intermediate, WTI) gaining 1.19% to $79.99.
(Written by Corentin Chapron, edited by)
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