by Claude Chendjou

PARIS (Reuters) – The main European stock markets are expected to show a cautious rebound on Wednesday before the publication of the main economic indicator of the week, monthly consumer prices in the United States.

According to the first available indications, the Parisian CAC 40 should rebound by 0.53% at the opening, the day after a session down by 0.86%. The Dax in Frankfurt could advance by 0.51%, while the FTSE 100 in London should gain 0.65%. The EuroStoxx 50 index is expected to increase by 0.71%.

Investors are awaiting the publication at 12:30 GMT of the consumer price statistics (CPI) in the United States for the month of March. The latest macroeconomic indicators showed a still vigorous American economy, at the risk of reawakening inflationary fears and removing the prospect of a rapid rate cut by the American Federal Reserve (Fed).

The Reuters consensus forecasts a slowdown in the CPI to 0.3% over one month, but an acceleration to 3.4% over one year, after respectively +0.4% and +3.2% in February.

“Markets will study the data to answer one question: is inflation persistent or is the improvement in disinflation in line with the Fed’s expectations?”, summarize ANZ economists.

“We believe the data suggests that inflationary pressures are slowly easing,” they added.

A WALL STREET

The New York Stock Exchange paused Tuesday during a cautious session.

The Dow Jones index fell 0.02%, or 9.13 points, to 38,883.67 points.

The broader S&P-500 rose 7.52 points (0.14%), to 5,209.91 points.

The Nasdaq Composite advanced 52.68 points (0.32%) to 16,306.64 points.

“Equity markets are marking time between major macroeconomic data and the start of the first quarter earnings season,” said Bill Northey, investment manager at US Bank Wealth Management in Montana.

“We are still very close to the all-time highs in the stock markets and this is very much a pause before these key data,” he added.

Bucking the trend, Moderna climbed 6.2% after announcing promising results from clinical trials of an anti-cancer vaccine developed with Merck.

IN ASIA

On the Tokyo Stock Exchange, the Nikkei index fell by 0.48%, to 39,581.81 points, on profit taking before the key figures for American inflation. The broader Topix lost 0.43% to 2,742.79 points at the close.

The MSCI index bringing together stocks from Asia and the Pacific (excluding Japan) rose 0.7% in the wake of the slight gains recorded the day before on the S&P 500 in New York.

In China, the Shanghai SSE Composite fell by 0.67% and the CSI 300 fell by 0.78%, while the Fitch agency downgraded China’s credit outlook to “negative”.

VALUES TO FOLLOW IN EUROPE:

EXCHANGES/RATES

The dollar remains firm (+0.06%) against a basket of reference currencies before American inflation.

The euro fell slightly (-0.07%), to 1.0847 dollars, after having gained 0.64% in one month.

The pound sterling is trading at 1.2675 dollars (-0.01%).

The yield on ten-year US Treasury bonds is stable at 4.3637%, after a decline of 6.6 basis points the day before.

The yield on the German Bund of the same maturity is stagnating, at 2.366% after a decline of 7.6 points on Tuesday.

OIL

Oil prices vary little on Wednesday after two consecutive sessions of decline, while the impasse in ceasefire negotiations in Gaza has revived uncertainty over the security of supplies from the Middle East.

Brent nibbles 0.28% to $89.67 per barrel and American light crude (West Texas Intermediate, WTI) gains 0.29% to $85.48.

(Writing by Claude Chendjou, editing by Zhifan Liu and Kate Entringer)

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