by Claude Chendjou
PARIS (Reuters) – European stock markets, apart from Frankfurt, rebounded slightly on Thursday thanks to a lull in the bond market, while Wall Street was in the red at mid-session in a wait-and-see context before publication US employment figures on Friday.
In Paris, the CAC 40 ended with a gain of 0.02% to 6,998.25 points. The British Footsie advanced 0.53%. The German Dax, weighed down by automobile stocks after the drop in registrations in September in the country, fell by 0.20%.
The EuroStoxx 50 index finished stable, while the FTSEurofirst 300 gained 0.23% and the Stoxx 600 0.28%.
The momentum brought to stocks since Wednesday by the fall in bond yields in the United States and Europe offered a little respite before gradually running out of steam under the weight of questions concerning the effectiveness of policy transmission. monetary policy of the American Federal Reserve (Fed).
Statistics on weekly jobless claims in the United States, published during the day, showed that the labor market remained tight despite the Fed’s massive rate hike. In this context, investors opted for caution before Friday’s publication of the monthly employment report from the US Department of Labor. The Reuters consensus forecasts a drop in job creations to 170,000, a slight decline in the unemployment rate to 3.7% but an acceleration in the growth of average hourly wages to 0.3% over one month.
ING analysts say in a note that more evidence will be needed before declaring that the labor market is slowing, downplaying the significance of Wednesday’s ADP survey in the United States which showed lower job creation than expected in September.
“The question everyone is asking is: Can yields continue to rise and at what point will yields cause serious damage to the economy?” said Baylee Wakefield, portfolio manager at Aviva Investors, referring to the ten-year Treasury rate which has been at a peak since 2007.
Several officials from the American Federal Reserve (Fed), including the institution’s vice-president responsible for banking supervision Michael Barr, are due to speak this evening.
In Europe, Ben Broadbent, the deputy governor of the Bank of England (BoE), said the debate over further rate hikes could be resolved by October 18 with the publication of new data.
In the euro zone, while Peter Kazimir, member of the Governing Council of the European Central Bank (ECB), estimated that the last rate increase decided in September was probably the final increase of the cycle, Philip Lane, the chief economist of the institution, noted that lending dynamics in the euro zone were weaker than expected.
VALUES
Alstom plunged 37.58%, the group having reduced its free cash flow (FCF) forecast for the fiscal year, notably due to order delays.
The jeweler Pandora jumped 11.96%, thanks to the increase in its growth objectives.
On a sectoral level, air transport (+1.45%) benefited from the fall in energy prices, TotalEnergies having dropped 0.53%, while Air France KLM climbed 3.74% and IAG , the home of British Airways, by 2.54%.
The luxury compartment (+0.5%) was also sought after and new technologies (-0.75%) neglected.
A WALL STREET
At the close in Europe, the Dow Jones fell by 0.45%, the Standard & Poor’s 500 by 0.58% and the Nasdaq by 0.65%.
The technology stock index lost 0.37% and that of energy 0.79%.
Dell Technologies drops 2.66% after its long-term annual revenue growth forecast, while electric vehicle maker Rivian Automotive plunges 19.75% after announcing its intention to sell convertible green bonds of worth $1.5 billion.
CHANGES
On foreign exchange, the dollar is marking time (-0.24%) against a basket of reference currencies, pending the report on American employment.
The yen and the euro took advantage of this to gain respectively 0.49% to 148.39 yen per dollar and 0.23% to 1.0527 dollars.
RATE
The yield on 10-year US Treasury bonds, which recently hit a 16-year high, fell by around two basis points to 4.7185%.
In Europe, the yield on the German Bund of the same maturity ended down 5.3 basis points, at 2.886%.
OIL
The oil market is affected by uncertainties about demand which take precedence over the announcement of a drop in production in certain OPEC+ countries: Brent fell by 1.93% to 84.15 dollars per barrel and American light crude (West Texas Intermediate, WTI) by 1.95% to $82.58.
(Written by Claude Chendjou, edited by Bertrand Boucey)
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