PARIS (Reuters) – Wall Street is expected to open moderately higher on Thursday ahead of the start of the Jackson Hole symposium, while Europe is up mid-session after a series of better-than-expected business indicators.
New York index futures suggest Wall Street will open in the green, with the Dow Jones up 0.08%, while the Standard & Poor’s 500 is up 0.06% and the Nasdaq is up 0.05%.
In Paris, the CAC 40 rose by 0.33% to 7,549.39 points at around 10:13 GMT. The Dax in Frankfurt strengthened by 0.27%, while the FTSE in London rose by 0.19%.
The pan-European FTSEurofirst 300 index gained 0.49%, the EuroStoxx 50 gained 0.32% and the Stoxx 600 increased by 0.52%.
US economic news will be on the minds of investors this weekend, as the trajectory of rates in the world’s largest economy continues to be questioned against a backdrop of mixed labor markets.
The Jackson Hole, Wyoming, labor market symposium could provide more insight into the Federal Reserve’s next moves: Chairman Jerome Powell will speak on Friday.
The main risk for risky assets is the divergence between the positioning of the central bank, which will probably favor regular cuts of 25 basis points, and that of the markets which are pricing in at least a cut of 50 basis points this year.
In fact, investors are concerned about the slowdown in labor markets: the revision of employment figures, published on Wednesday, showed that the number of jobs created this year was less than initially announced.
The publication at 12:30 GMT of weekly unemployment registrations, usually a second-order indicator, will therefore be awaited for the indications it could provide on the demand for labor.
The European markets, while also paying attention to developments across the Atlantic, are digesting the PMI indicators published on Thursday mid-session.
Activity in the Eurozone thus surprised on the upside, with the services sector in particular growing more than expected.
In contrast, German activity disappointed, with the private sector contracting for the second consecutive month, rekindling fears of recession in the bloc’s largest economy.
“The momentum comes largely from a surge in services activity in France, with the business activity index jumping by almost five points, which is probably linked to the Paris Olympics,” said Christophe Boucher, investment director at ABN AMRO Investment Solutions, who considers the fundamentals “uncertain.”
However, “price pressures in the services sector have eased, which supports a rate cut by the ECB in September,” the official added.
VALUES TO FOLLOW ON WALL STREET
Microsoft lowered its revenue forecast for its Azure division in the first quarter, now targeting between $23.80 billion and $24.10 billion, from $28.6 billion and $28.9 billion previously.
Zoom Video Communications raised its full-year revenue forecast on Wednesday, benefiting from strong demand for its artificial intelligence (AI)-powered collaboration tools.
VALUES TO FOLLOW IN EUROPE
Dutch insurer Aegon reported a drop in its capital generation indicator in the first half of the year on Thursday, down 5.54%.
Deutsche Bank rose 3.04% after announcing on Wednesday that it had reached settlements with more than half of the plaintiffs who accused the German bank of underpaying them when it acquired Postbank several years ago.
Swiss Re reported results on Thursday that were in line with expectations, reporting a 17% increase in its profit for the first six months of the year, and gained 3.16%.
British sportswear retailer JD Sports Fashion reported a 2.4% rise in underlying sales in the second quarter on Thursday, jumping 6.43%.
Biomerieux climbs 4.78% after UBS started monitoring the stock and recommended “buy”.
Bavarian Nordic soared 11.3% after the group reported better-than-expected second-quarter results.
RATE
US yields are rising ahead of the publication of weekly unemployment figures and the opening of the Jackson Hole symposium, at which Jerome Powell will speak.
The 10-year Treasury yield rose 4.4 basis points to 3.8199%, while the two-year yield rose 3.7 basis points to 3.9593%.
The yield on the German ten-year rate rose by 1.9 basis points to 2.221%, while that of the two-year rate was stable at 2.376%.
CHANGES
The euro fell slightly against the dollar, under pressure from worse-than-expected PMI indicators in Germany, although good activity figures in the eurozone helped to limit the extent of the decline.
The dollar gained 0.19% against a basket of benchmark currencies, the euro eroded 0.11% to $1.1138, and the pound strengthened 0.26% to $1.3126.
OIL
The barrel is on the rise, with figures published Wednesday by the American Energy Information Administration suggesting that oil consumption remains strong in the United States, where crude inventories fell by 4.6 million barrels last week.
Brent rose 0.53% to $76.45 per barrel, while American light crude (West Texas Intermediate, WTI) rose 0.38% to $72.2.
(Written by Corentin Chappron, edited by Kate Entringer)
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