by CORENTIN CHAPRON
PARIS (Reuters) – European stock markets ended in the red on Thursday, with the exception of the FTSE, as investors digested the latest announcements from the Federal Reserve (Fed) as well as a burst of company results.
In Paris, the CAC 40 lost 0.88% to 7,914.65 points, while the German Dax fell 0.15% and the British Footsie rose 0.63%.
The EuroStoxx 50 index ended the session down 0.53%, compared to 0.20% for the FTSEurofirst 300 and 0.19% for the Stoxx 600.
European stock indices fell as the Fed signaled on Wednesday that the limited decline in inflation in recent months would force it to maintain its high rates for longer than expected.
“Confidence (in the return of inflation to its target) is not easy to predict, and after the surprises of the start of the year, we expect that several months of falling inflation will be necessary to give this confidence” to the Fed, write Societe Generale strategists.
“As a result, rate cuts only seem possible at the end of the year, and this need for confidence leaves little room for further upside surprises.”
As such, unemployment claims were once again lower than expected last week, according to Thursday’s figures, indicating that the imbalance between labor supply and demand is struggling to resolve.
European assets suffer from this outlook, which implies that the gap between European and American monetary policy will increase and favor dollar assets.
The final PMI indicators for the manufacturing sector also served as a reminder on Thursday of the gap between American and European economic dynamics, the euro zone beginning to recover from a year and a half of sluggish activity, while American growth remains robust. .
Corporate results also livened up trading on Thursday, with the British FTSE notably supported by good results from Shell and Standard Chartered.
A WALL STREET
The New York Stock Exchange is moving forward, with the Fed emphasizing on Wednesday that a return of inflation to its target without a significant increase in unemployment remains its base scenario.
At closing time in Europe, trading on the New York Stock Exchange indicated an increase of 0.44% for the Dow Jones, compared to 0.4% for the Standard & Poor’s 500, and 0.81% for the Nasdaq Composite.
VALUES
Worldline reported organic revenue growth of 2.5% in the first quarter on Thursday, and jumped 10.57%.
Teleperformance advanced 14.2% after publishing first-quarter sales that were less bad than expected.
Imerys rose 12.02% after reporting an encouraging outlook on Thursday.
Novo Nordisk raised its outlook for 2024 on Thursday, but less strongly than the markets expected, which caused the stock to fall by 2.74%.
ING announced on Thursday a share buyback of 2.5 billion euros, following a quarterly performance considered strong, and advanced 6.43%.
AP Moller-Maersk reported quarterly profit above expectations on Thursday, but missed Ebit estimates and fell 4.38%.
Hugo Boss reported on Thursday that demand continued to decline in certain geographies, including China, and fell by 6.53%.
Shell rose 2.3% after posting better-than-expected results.
Standard Chartered gained 8.7% after reporting pre-tax profit up 5.5% in the first quarter, higher than analysts’ expectations.
RATE
Bond markets remained calm on Thursday as investors digested the Fed’s latest comments.
At the close of the European interest rate markets, the yield on the ten-year Treasury rose 1.7 bp to 4.6078%, compared to a decline of 2.5 bp for the two-year rate, to 4.9143%.
The German ten-year yield fell 2.8 bps to 2.554%, while the two-year yield fell 3 bps to 2.999%.
CHANGES
The euro and the pound fell against the dollar while new jobless claims fell more than expected in the United States.
The dollar lost 0.1% against a basket of reference currencies, while the euro lost 0.05% to 1.0704 dollars. The pound sterling fell 0.19% to $1.2501.
OIL
Crude faltered after new jobless claims figures, while data from the Energy Information Administration showed U.S. oil inventories rose to their highest level since June.
Brent is stable at $83.44 per barrel, American light crude (West Texas Intermediate, WTI) decreases by 0.25% to $78.8.
(Written by Corentin Chappron, edited by Blandine Hénault)
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