by Claude Chendjou

PARIS (Reuters) – European stock markets ended higher on Friday and on Wall Street, two of the three main indices were also in the green at mid-session, with monthly inflation data published in the euro zone and the United States pleading for a lull on the interest rates of the major central banks.

In Paris, the CAC 40 ended with a gain of 0.26% to 7,135.06 points. The British Footsie gained 0.29% and the German Dax 0.41%.

The EuroStoxx 50 index rose by 0.44%, the FTSEurofirst 300 by 0.41% and the Stoxx 600 by 0.52%.

Over the entire quarter, dominated by fears about the trajectory of rates after restrictive comments from central bankers, the CAC 40 however suffered a loss of 3.58% and the Stoxx 600 a decline of 2.54%.

Equity markets were reassured on Friday by figures published by Eurostat showing that the consumer price index in the euro zone decelerated to 4.3% year-on-year in September, to its lowest level in two years, after an increase of 5.2% in August.

The governor of the Bank of France, François Villeroy de Galhau, estimated in the wake of this publication that the current level of interest rates of the European Central Bank (ECB) was now “appropriate” while in France the Inflation remained at 4.9% this month, despite rising energy prices.

In the United States, core PCE inflation, closely monitored by the Federal Reserve (Fed), decelerated more than expected, to 0.1% in August over one month, after an increase of 0.2%. in July. Over one year, its progression was reduced to 3.9%, compared to 4.3% in July.

“This is good news,” said Thierry Wizman, foreign exchange and rates strategist at Macquarie. “There has been a clear normalization of inflation, even at the underlying level, over the last few months in the United States. This suggests that the Fed has probably tightened interest rates too much… ) and that it does not need a new increase,” he added.

A WALL STREET

At the close in Europe, the volatile Dow Jones fell 0.15% while the Standard & Poor’s 500 gained 0.18% and the Nasdaq 0.61%.

Among the main sectors of the S&P-500, real estate (+0.60%) and new technologies (+0.83%) recorded the largest gains with the ebbing of fears about the cost of credit.

RATE

The yield on ten-year US Treasury bonds, which recently hit a 16-year high, fell almost four basis points to 4.5629%.

In the euro zone, its German equivalent ended down almost 13 basis points, to 2.842%, while the two-year yield lost 9.2 points, to 3.2070%.

EXCHANGES The dollar weakened on Friday, by 0.11%, against a basket of reference currencies.

The greenback, however, remains, at this stage, on 11 weekly increases in a row, the longest series in nine years, and it is on track to gain almost 3% over the entire quarter.

The euro rose to 1.0579 dollars (+0.19%), after falling to a nine-month low on Wednesday, at 1.0488 dollars.

The pound sterling, which returned from a low since March 17 reached this week, was posted on Friday at 1.2213 dollars (+0.13%), with revised official data showing that the economic performance of Great Britain Brittany since the start of the COVID-19 pandemic has been stronger than previously reported.

VALUES IN EUROPE

The new technology (+1.26%) and luxury (+1.24%) indices supported the trend on the Stoxx 600. In Paris, LVMH, Hermès and Kering advanced by 0.57% to 1.47. %. The confirmation of a preliminary investigation by the public prosecutor targeting Bernard Arnault, CEO of LVMH, for possible money laundering did not have a major effect on the stock.

Atos increased by 3.25% with the rebound in “tech” and the confirmation of the departure of the general director of its BDS (Big Data and Cybersecurity) division.

Adidas jumped 6.22% in the wake of the publication of Nike results, which climbed 6.45% on Wall Street.

TODAY’S INDICATORS

The morale of American households came out in September above the initially estimated figure (68.1 against 67.7), show the final results of the University of Michigan survey.

Retail sales in Germany fell unexpectedly in August, by 1.2% compared to the previous month, according to data from the Federal Statistical Office.

Producer prices on the French market started to rise again, by 0.6% in August, according to INSEE.

OIL

Oil prices are volatile, with macroeconomic concerns dampening their recent surge as OPEC meets next week. At the time of closing in Europe, Brent fell by 0.07%, to 95.31 dollars per barrel, and American light crude (West Texas Intermediate, WTI) by 0.84%, to 90.94 dollars, the two oil benchmarks having gained and lost up to almost a dollar during the session.

(Written by Claude Chendjou, edited by Bertrand Boucey)

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