by Claude Chendjou

PARIS (Reuters) – The main European stock markets are expected on a cautious note on Tuesday at the start of a series of political, economic and monetary events in the week which could cause volatility on the markets.

European markets should also follow in the wake of Asian markets where the trend was mixed after the absence of announcements of major recovery measures from Beijing as the annual session of the National Congress opened. of the People (CNP). Prime Minister Li Qiang said he wanted to “transform” China’s economic model, with growth of around 5% this year, without providing details on how to achieve this.

According to the first available indications, the Parisian CAC 40 should lose 0.23% at the opening, moving away from the threshold of 8,000 points that it has been targeting since last week. The Dax in Frankfurt is expected to fall by 0.34%. The FTSE 100 in London could fall by 0.33%. The EuroStoxx 50 index is expected to drop 0.26%.

For today’s session, investors will take note of the economic figures for services activity for the month of February in the euro zone and the United States, as well as the producer price index in January in the monetary bloc.

These indicators will be watched as the two main events of the week focus on the European Central Bank (ECB) monetary policy meeting on Thursday and the monthly US jobs report on Friday.

Before that, several central bankers, including the President of the American Federal Reserve Jerome Powell, will have spoken, while on Wednesday the Fed’s Beige Book will be published which serves as a working basis for the monetary policy committee (FOMC) of the bank American center.

To add to an already busy week, this Tuesday also marks “Super Tuesday”, characterized by the simultaneous vote of a large number of American states to decide between the candidates of the Democratic Party and the Republican Party for the presidential election of November while President Joe Biden is scheduled to deliver his State of the Union address on Thursday.

A WALL STREET

The New York Stock Exchange ended down on Monday, with caution dominating the markets before a new burst of indicators and two interventions by Fed President Jerome Powell, which will be interpreted as a sign of the imminence, or not, of of the start of the monetary easing of the institution.

The Dow Jones index fell 0.25%, or 97.55 points, to 38,989.83 points.

The broader S&P-500 lost 6.13 points, or 0.12%, to 5,130.95 points.

The Nasdaq Composite fell 67.43 points (-0.41%) to 16,207.51 points.

In terms of values, Apple lost 2.53% after being sentenced on Monday by the European Commission to a fine of 1.84 billion euros for competition violations. The apple brand has announced that it will appeal.

IN ASIA

On the Tokyo Stock Exchange, the Nikkei ended down 0.03% at 40,097.63 points, the day after a record session, following a 19% increase in the index since the start of the year. The broader Topix, on the other hand, gained 0.5% to 2,719.93 points.

On the Nikkei, investors opted to take profits on stocks like Advantest (-2.64%) and Daikin Industries (-2.17%).

The MSCI index bringing together stocks from Asia and the Pacific (excluding Japan) fell 1%.

In China, the Shanghai SSE Composite gained 0.36% and the CSI 300 gained 0.76%, in a volatile session where the markets digested the announcements of the Chinese Parliament while the activity of the services sector in China slowed in February to 52.5, compared to 52.7 in January, according to the Caixin survey.

VALUES TO FOLLOW IN EUROPE:

EXCHANGES/RATES

The dollar is stable (+0.05%) against a basket of reference currencies after having also stood still the day before while awaiting the week’s indicators.

The euro fell by 0.06%, to 1.0848 dollars while the markets are counting on a status quo on ECB rates on Thursday and a first reduction in the cost of money in June.

The pound sterling is trading at $1.2677 (-0.1%) on the eve of the budget presentation by British Finance Minister Jeremy Hunt, who is working to temper expectations of lower taxes.

In cryptocurrencies, bitcoin, which recently reached a two-year high, lost 0.4% to $67,227.04.

On the bond market, the yield on ten-year US Treasury bonds fell by around one basis point, to 4.2052%, after hitting a two and a half week low the day before.

The yield on the ten-year German Bund, the benchmark for the euro zone, stands at 2.379%, also down by around one point.

OIL

Oil prices fell on Tuesday, as China’s commitments to transform its economy failed to convince investors, still concerned about the slowdown in consumption in the country.

Brent fell by 0.43% to $82.44 per barrel and American light crude (West Texas Intermediate, WTI) by 0.56% to $78.30.

MAIN ECONOMIC INDICATORS ON THE AGENDA FOR MARCH 5:

COUNTRY GMT INDICATOR PERIOD PREVIOUS CONSENSUS

FR 07:45 Industrial production January -0.3% 1.1%

FR 08:50 S&P Global/HCOB February Index 48.0 48.0*

services (definitive)

FR 08:50 S&P Global/HCOB Index February 47.7 47.7*

composite (definitive)

FROM 8:55 a.m. February S&P Global/HCOB Index 48.2 48.2*

services (definitive)

FROM 8:55 a.m. S&P Global/HCOB Index February 46.1 46.1*

composite (definitive)

EZ 09:00 February S&P Global/HCOB Index 50.0 50.0*

services (definitive)

EZ 09:00 S&P Global/HCOB Index February 48.9 48.9*

composite (definitive)

GB 09:30 February S&P Global/CIPS Index 54.3 54.3*

services (definitive)

GB 09:30 S&P Global/CIPS Index February 53.3 53.3*

composite (definitive)

ZE 10:00 Producer prices January na -0.8%

US 3:00 p.m. ISM services February 53.0 53.4

*first estimate

(Written by Claude Chendjou, edited by Zhifan Liu)

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