by Pauline Foret
(Reuters) – Major European stock markets edged higher in early trading, led by the mining sector and investors’ hopes for Jerome Powell’s speech at the Jackson Hole symposium this afternoon.
In Paris, the CAC 40 gained 0.40% to 7,554.57 points at around 07:30 GMT. In London, the FTSE 100 gained 0.22%, while in Frankfurt, the Dax advanced 0.24%.
The EuroStoxx 50 index is up 0.28%, the FTSEurofirst 300 is up 0.16% and the Stoxx 600 is up 0.17%.
Markets are hoping that Jerome Powell will give some hints about the possibility of a “soft landing”, with a less aggressive rate cut than previously expected, during the speech he is expected to deliver around 1400 GMT in Jackson Hole, Wyoming.
“What has been a quiet week could see last-minute volatility with Powell’s speech, where he is expected to end expectations of a rate cut,” Ipek Ozkardeskaya, an analyst at Swissquote Bank, said in a note.
“There is no reason for the Fed to start cutting rates in large chunks absent a severe economic slowdown, market stress or a crisis,” she added.
Markets are pricing in the chances of a 25-bp rate cut at the September meeting at 75%, given what were considered pessimistic comments by Fed officials recently and data that have confirmed some slowdown in inflation in the economy.
In terms of values, Nestle fell by almost 3% after announcing the resignation of its chairman and CEO Mark Schneider, who will be replaced by Laurent Freixe.
Galapagos advanced 2.7% after opening up 4% after receiving FDA clearance to launch its Atalanta-1 study in the United States.
(Written by Pauline Foret, edited by Augustin Turpin)
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