PARIS (Reuters) – Wall Street is expected to be mixed on Wednesday, while European stock markets advance ahead of US inflation figures and the European Central Bank’s decision on Thursday.
Futures on New York indices suggest Wall Street opening in the green, with the Dow Jones rising 0.13%, while the Standard & Poor’s 500 and the Nasdaq appear unchanged.
In Paris, the CAC 40 advanced 0.48% to 8,087.79 points around 10:35 GMT. The Dax in Frankfurt gained 0.64%, compared to 0.62% for the FTSE in London.
The pan-European FTSEurofirst 300 index rose by 0.5%, compared to 0.7% for the EuroStoxx 50 and 0.54% for the Stoxx 600.
Traders are focused on the US inflation indicator, which will be published at 12:30 GMT and is the main indicator of the week.
“American inflation is under everyone’s attention,” notes ING, which recalls that “the consensus expects an increase in the underlying index of 0.3% over one month. This suggests that there could still be a downward reaction if the consensus is confirmed.
Investors will be attentive to the components of the indicator, in particular concerning services: pressures which remain strong could limit the room for maneuver and prevent the central bank from lowering its rates by the summer, especially as the markets employment, the Federal Reserve’s other mandate, is doing well.
The Fed’s “minutes”, which will be published on Wednesday at 06:00 GMT, will also liven up the discussions.
European markets will also be attentive to the decision of the European Central Bank on Thursday, which should maintain its rates at their current levels but could prepare the ground for a rate cut in June.
The economic situation in the euro zone is in fact clearly deteriorating, as shown by the latest survey on credit in the bloc published on Tuesday by the institution.
The opening of the results season on Friday in the United States will also liven up trading at the end of the week.
VALUES TO FOLLOW IN WALL STREET
TSMC announced on Wednesday a 16.5% increase in its turnover in the first quarter, above consensus, thanks to demand linked to artificial intelligence.
VALUES TO FOLLOW IN EUROPE
Technology is progressing, in the wake of TSMC’s good results. Chip equipment makers ASM International and ASML Holding advance 0.66% and 1.03% respectively, while integrated makers Infineon, BE Semiconductor and STMicroelectronics gain 1.59% to 1.06%.
The European new technologies index gained 0.73%.
Edenred fell 3.71% after Jefferies began covering the stock by recommending “underperform”.
Chocolate manufacturer Barry Callebaut jumped 8.78% after reporting generally unchanged sales volumes for its six months ended at the end of February, despite rising raw material costs.
Wind turbine makers are making progress after the European Union said it would investigate subsidies received by Chinese wind groups. Siemens Energy gained 2.33% and Nordex 2.62%.
Philips is up 2.3%, the group having revealed the main terms of an agreement concluded in January with the US government on its devices intended to treat sleep apnea. The dispute cost the company more than 360 million euros in the fourth quarter of 2023.
Tesco gained 3.55%, the group having posted a profit of 2.76 billion pounds for the 2023-2024 financial year, against a forecast of 2.75 billion pounds.
RATE
Returns are stable in a wait-and-see environment.
The German ten-year yield is unchanged at 2.365%, that of the two-year rate loses 1.3 bp to 2.876%.
The yield on the ten-year Treasury is holding steady at 4.3597%, while the two-year remains at 4.7407%.
CHANGES
Exchange rates remain hesitant ahead of US inflation.
The dollar fell by 0.09% against a basket of reference currencies, the euro gained 0.05% to $1.086, and the pound sterling rose by 0.17% to $1.2697.
OIL
Tensions in the Middle East are supporting crude, while market sources citing figures from the American Petroleum Institute report an increase in American stocks of 3.3 million barrels, against 2.4 million expected.
Brent advanced 0.29% to $89.68 per barrel, American light crude (West Texas Intermediate, WTI) gained 0.29% to $85.48.
(Written by Corentin Chappron, edited by Kate Entringer)
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