by Augustin Turpin

(Reuters) – European stock markets finished stable or up and Wall Street hesitated mid-session on Friday, at the end of a day loaded with data, with PCE inflation figures in the United States having notably revived hopes of an upcoming cut in key rates from the American Federal Reserve and supported equities.

In Paris, the CAC 40 ended up 0.18% at 7,992.87 points. The British Footsie gained 0.57% and the German Dax was stable at 0.01%.

The EuroStoxx 50 index gained 0.03% and the FTSEurofirst 300 0.34%.

The Stoxx 600 increased by 0.32% but is on track to record its second consecutive week of decline, in a context of pressure in the bond compartment. The European benchmark index should, however, end the month in green.

The successive publication of figures for euro zone inflation and American PCE inflation livened up trading on Friday and revived optimism about key rate cuts in the United States.

Operators estimate the probability of a rate reduction by September to be 51%, compared to 49% before the publication of the PCE inflation index.

At closing time in Europe, the Dow Jones gained 0.17%, the Standard & Poor’s 500 lost 0.53% and the Nasdaq Composite fell 1.27%.

“This is a positive report for the market. It appears the headline and core numbers are in line with expectations,” said Art Hogan, head of market strategy at B Riley Wealth in New York.

The New York Stock Exchange opened higher after inflation data while the dollar and US bond yields fell.

VALUES

In Paris, Neoen soared by 20.57%, its trading having been suspended on Thursday after the Canadian Brookfield revealed its plan to buy the group, while Capgemini declined by 4.5% after a reduction in recommendation of JPMorgan and Jefferies.

The Swedish Saab closed with an increase of 5.6% after an order for defense equipment worth 7.7 billion Swedish crowns (673.64 million euros). JD Sports fell 4.7% as the British retailer disappointed expectations by maintaining its annual profit forecast.

TODAY’S INDICATORS

Retail sales in Germany fell more than expected in April, falling 1.2% from the previous month

In France, year-on-year inflation grew at the same rate in May and April, but it rebounded this month in the euro zone, while French household consumption expenditure on goods in April fell from 0, 8%.

Furthermore, the final figures from INSEE on GDP showed quarterly growth of 0.2% in the French economy. INSEE also revised growth upwards for 2023.

The PCE consumer price index in the United States rose 0.3% in April, in line with the previous month’s unrevised figure. Over one year, the index increased by 2.7%, as in March.

CHANGES

The dollar is stable (-0.03%) against a basket of reference currencies after the inflation figures, while the euro gains 0.09% to 1.0842 dollars.

RATE

Bond yields are falling with renewed optimism that the Fed’s rate cut schedule will be maintained.

The ten-year German Bund yield lost 4.8 basis points (bps) to 4.5065%, with the two-year rate losing 4.0 bps to 4.8893%.

The ten-year US Treasury lost 4.8 bp to 4.5065%.

OIL

Oil prices are falling as traders focus on the upcoming OPEC+ meeting on Sunday.

Brent fell 0.26% to 81.65 dollars per barrel, American light crude (West Texas Intermediate, WTI) losing 0.49% to 77.53 dollars.

TO BE CONTINUED ON MONDAY:

THE SITUATION ON THE MARKETS

(Some data may have a slight lag)

(Written by Augustin Turpin, edited by Jean-Stéphane Brosse)

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