PARIS (Reuters) – The main European stock markets are expected to rise at the opening on Wednesday, driven by optimism about American rates, in a calm market context before the end of the year.

The first available indications indicate that the Parisian CAC 40 would show an increase of 0.34% at the opening. Futures contracts on the FTSE in London suggest an opening advance of 0.45%, compared to 0.4% for the Dax in Frankfurt, and 0.5% for the EuroStoxx 50.

The markets are betting that the American Federal Reserve will soon be finished with rate hikes, an optimism justified by the latest indicators which showed a decline in inflation and a slowdown in activity in the United States compatible with a scenario of ‘soft landing.

Money markets consider a Fed rate cut almost certain as early as March.

Trading remains marked by low volatility, while most operators are on vacation and no major economic indicators or events are expected between now and the end of the year.

Only new unemployment claims in the United States for the week ending December 23 will be published on Thursday at 1:30 p.m. GMT.

VALUES TO FOLLOW:

A WALL STREET

The New York Stock Exchange ended up on Tuesday, confirming the dynamics of recent weeks, with the S&P-500 having reached a peak in session for almost two years, while investors anticipate a reduction in Fed rates in 2024, possibly from the first trimester.

The Dow Jones index gained 0.43%, or 159.36 points, to 37,545.33 points. The broader S&P-500 gained 20.12 points, or 0.42%, to 4,774.75 points. The Nasdaq Composite advanced 81.60 points (0.54%) to 15,074.57 points.

IN ASIA

The Tokyo Stock Exchange ended up on Wednesday, driven by semiconductor manufacturers, in the wake of Wall Street, and by exporters, supported by the fall in the yen. The Nikkei index gained 1.13% to 33,681.24 points and the broader Topix gained 1.10% to 2,364.50 points.

SoftBank Group posted the biggest gain on the Nikkei, rising 4.48% after exercising an option to receive shares of telecommunications operator T-Mobile US worth about $7.59 billion.

Chinese indices are increasing after two days of closure Monday and Tuesday. The Shanghai SSE Composite nibbles 0.28%, the CSI 300 0.15%, the Hong Kong Hang Seng index advances 1.56%.

RATE

American yields are hesitating in a wait-and-see environment.

The ten-year Treasury yield is stable at 3.8779%, while the two-year rate is stagnating at 4.2953%.

CHANGES

The currency market is calm, with the dollar remaining near its lowest in five months.

The dollar is immobile against a basket of reference currencies, while the euro remains at $1.104, and the pound sterling at $1.2731.

In Asia, the yen fell 0.13% to 142.57 yen per dollar, while the Australian dollar gained 0.09% to 0.683 dollars.

OIL

Oil is down slightly as markets remain attentive to developments in the Red Sea.

Brent eroded by 0.12% to 80.97 dollars per barrel, American light crude (West Texas Intermediate, WTI) weakened by 0.2% to 75.42 dollars.

NO MAJOR ECONOMIC INDICATOR ON THE AGENDA FOR DECEMBER 26

(Written by Corentin Chappron, edited by Tangi Salaün)

Copyright © 2023 Thomson Reuters