by Claude Chendjou

PARIS (Reuters) – European stock markets ended Tuesday with slight variations and Wall Street was practically stable at mid-session after a speech by Jerome Powell, the president of the American Federal Reserve (Fed), considered reassuring on inflation.

In Paris, the CAC 40 ended with a gain of 0.20% to 8,225.8 points, close to its record. The British Footsie advanced 0.16%. The German Dax, on the other hand, lost 0.1%, penalized by the values ​​of so-called non-essential consumption.

The EuroStoxx 50 index increased by 0.03% and the FTSEurofirst 300 by 0.10%. The Stoxx 600 gained 0.15%, reaching a new high at 521.86 points, thanks in particular to the banking sector (+0.86%) and the automobile sector (+1.31%). US President Joe Biden announced new measures relating to an increase in customs duties on Chinese imports, including electric vehicles.

On the monetary policy side, speaking at a banking event in Amsterdam, Jerome Powell said on Tuesday that he expected inflation to continue to moderate this year, as was the case in 2023, even if its degree of confidence is lower than before. He added, however, that the Fed was unlikely to raise interest rates again, reiterating that the central bank would be “patient” in allowing the current policy to unfold its full impact.

Before that, the publication of producer prices (PPI), whose month-on-month figures rebounded by 0.5% in April, above the Reuters consensus, had awakened fears of a resurgence of inflation. Jerome Powell considered that this statistic was more “mixed” than reflecting “overheating”.

The president of the Dutch central bank, Klaas Knot, who participated in the same event in Amsterdam, for his part estimated that the decline in inflation in the euro zone opened the way to rate cuts.

Pending the publication of inflation figures for the entire euro zone on Friday, the slowdown in prices in Germany, the bloc’s largest economy, was confirmed this Tuesday at 2.4% year-on-year in April.

VALUES IN EUROPE

Veolia published sharply higher first-quarter results on Tuesday, driven in particular by water technologies and its efficiency plan. The group also confirmed its annual objectives, which allowed the stock to end with a gain of 2.13%.

Delivery Hero soared 26.34% thanks to a $1.2 billion deal with Uber

Rheinmetall fell 2.72% as the German arms maker missed consensus on sales and profit in the first quarter.

Alcon jumped 7.53% as the Swiss ophthalmology group’s margin exceeded expectations in the first quarter,

The hearing aid manufacturer Sonova Holding rose 6.76%, driven by a forecast of accelerated growth for this year.

A WALL STREET

At the close in Europe, the Dow Jones fell by 0.02%, while the Standard & Poor’s 500 advanced by 0.05% and the Nasdaq by 0.28% after the monthly producer price figures while the market is now awaiting those of consumer prices, scheduled for Wednesday.

In terms of values, Home Depot lost 1.05% after reporting a larger than expected drop in its quarterly sales on Tuesday, while Alibaba dropped 7.18% after an 86% plunge in its quarterly profit.

Gamestop (+69.03%) and other “meme stocks” continue their stock market rally in the wake of the reappearance on social networks of “Roaring Kitty”, an iconic character.

TODAY’S INDICATORS

Investor morale in Germany has improved more than expected since the beginning of May, shows the monthly survey published Tuesday by the ZEW economic research institute.

RATE

Sovereign yields in Europe and the United States varied little on Tuesday, the ten-year Treasuries remained stable at 4.4708%, while the German Bund of the same maturity ended with a gain of around three points, at 2.547%.

CHANGES

The dollar fell slightly, by 0.14%, against a basket of reference currencies.

The euro, which has gained 1% against the dollar since the start of the month, advanced Tuesday by 0.25%, to 1.0815 dollars.

The pound sterling advanced 0.22% to 1.2585 dollars. The British currency is volatile as Huw Pill, the chief economist of the Bank of England (BoE), suggested that the central bank could consider cutting interest rates over the summer, despite rising prices. wages in Great Britain over the three months to the end of March. Other data, however, suggests that the labor market is losing some of its inflationary momentum.

OIL

Oil prices are falling, with US data suggesting continued inflationary pressures, while OPEC maintained its demand forecast for the year.

Brent lost 1.32% to $82.26 per barrel and American light crude (West Texas Intermediate, WTI) lost 1.54% to $77.90.

TO BE CONTINUED ON WEDNESDAY:

(Writing by Claude Chendjou, edited by Kate Entringer)

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