by Claude Chendjou

PARIS (Reuters) – The main European stock markets are expected to be on a cautious note at the opening on Thursday, with expectations of an imminent cut in interest rates being thwarted by the latest economic statistics and statements from central bankers.

According to the first available indications, the Parisian CAC 40 should fall by 0.1% at the opening, which would mark a third consecutive session of decline. The Dax in Frankfurt should open stable (+0.02%), while the FTSE 100 in London could lose 0.07%. The EuroStoxx 50 index is expected to fall by 0.02%.

Mixed publications from large companies, particularly American banks, weighed on investor sentiment in recent sessions, while the market in Europe is awaiting results in the luxury sector with Richemont this Thursday and Burberry Friday. The latter warned last week about its annual profit forecast. In this regard, LVMH and Kering will be ones to watch in Paris.

On the monetary policy side, the President of the European Central Bank (ECB), Christine Lagarde, the boss of the Dutch central bank, Klass Knot, and one of the governors of the American Federal Reserve, Christopher Waller, recently considered a reduction premature interest rates, causing a rise in bond yields.

At the same time, the re-acceleration of inflation in the United Kingdom and the euro zone, combined with the resistance of the American economy, notably with stronger than expected retail sales and an increase in industrial production in December, do not argue for an easing imminent monetary policy. The publication this Thursday, at 1:30 p.m. GMT, of the “Philly Fed” activity index in the United States for the month of January could confirm or invalidate this trend.

A WALL STREET

The New York Stock Exchange ended lower on Wednesday as an official report indicating an increase in retail sales in December in the United States reduced the hypothesis of a shift in the Fed’s monetary policy from March .

The Dow Jones index lost 0.25% to 37,266.67 points.

The broader S&P-500 lost 0.56% to 4,739.21 points.

The Nasdaq Composite fell 0.59% to 14,855.62 points.

The CBOE volatility index, considered an indicator of the level of fear on Wall Street, rose during the session to its highest level in more than two months. In its “beige book”, published early this afternoon, the Fed also reported that American economic activity remained stable from December to early January, while businesses reported less pressure on the market. work.

Among the major sectors of the S&P-500, real estate, particularly sensitive to interest rates, fell by 2.7%.

High-growth stocks weighed on the market: Amazon, Nvidia and Alphabet lost between 0.5% and 1%, while Tesla fell 2% after announcing a price cut in Germany following a similar decision in China last week.

IN ASIA

On the Tokyo Stock Exchange, the Nikkei index ended down 0.03% at 35,466.17 points in a volatile session where it briefly approached its 34-year high against a backdrop of depreciation of the yen which driven by export stocks such as Toyota Motor (+2.63%) or Bridgestone (+1.68%). The broader Topix lost 0.17%, to 2,492.09 points, at the close.

The MSCI index bringing together stocks from Asia and the Pacific (excluding Japan) gained 0.10%.

In China, the Shanghai SSE Composite fell by 0.97% and the CSI 300 dropped 0.01% to 3,229.5049 points, after hitting a low since 2019 at 3,204.63 points. The Hang Seng Index in Hong Kong fell to a 14-month low of 15,183.96 points.

VALUES TO FOLLOW IN EUROPE:

EXCHANGES/RATES

The dollar, down 0.15%, nevertheless remains close to a one-month high against a basket of reference currencies, with retail sales in the United States having reinforced the prospect that the Fed will not rush not to lower interest rates.

The euro advanced 0.19%, to 1.0902 dollars, while the pound sterling stood at 1.2694 dollars (+0.17%).

On the bond market, the yield on ten-year US Treasury bonds fell by almost two basis points, to 4.0884%, after crossing the previous day, for the first time since the start of the year, the 4.1% mark.

OIL

The oil market is trending upwards as OPEC forecasts relatively strong growth in global crude demand over the next two years. Oil production in North Dakota has also fallen by more than half, from 650,000 to 700,000 barrels per day (bpd), due to the extreme cold in the United States.

Brent advanced 0.56% to $78.32 per barrel and American light crude (West Texas Intermediate, WTI) rose 0.87% to $73.19.

MAIN ECONOMIC INDICATORS ON THE AGENDA FOR JANUARY 18:

COUNTRY GMT INDICATOR PERIOD PREVIOUS CONSENSUS

FROM 7:00 a.m. Car registrations December na -5.7%

over one year

GB 07:00 Car registrations December na +9.5%

over one year

FR 07:00 Car registrations December na +14.0%

over one year

USA 1:30 p.m. Weekly registrations for the week at 8 207.000 202.000

unemployment January

USA 1:30 p.m. Activity index “Philly January -7.0 -10.5

fed”

(Written by Claude Chendjou)

Copyright © 2024 Thomson Reuters