by Claude Chendjou

PARIS (Reuters) – The main European stock markets, apart from London, ended in the red on Wednesday, affected in particular by disappointing results in luxury and new technologies from LVMH and ASML.

In Paris, the CAC 40 ended down 0.40% at 7,492 points. The British Footsie, supported by the defensive compartments of real estate (+1.83%) and “utilities” (+1.89%), advanced by 0.97%. The German Dax lost 0.18%.

The EuroStoxx 50 index fell by 0.72%, the FTSEurofirst 300 by 0.18% and the Stoxx 600 by 0.15%.

At the close in Europe, the Dow Jones advanced by 0.42%, the Standard & Poor’s 500 by 0.13%, while the Nasdaq was in balance.

The first two American stock indices, which are close to their record level, benefit from the improvement in the banking sector (+0.74%) following the publication of the results of Morgan Stanley (+7.24%), First Horizon (+3.86%) or even US Bancorp (+4.67%).

In Europe, the technology compartment (-1.52%) and the luxury sector (-1.59%) weighed on the Stoxx 600 after the quarterly accounts of two heavyweights of the rating which further distance the pan-European index from the summit of more than two weeks reached Tuesday.

VALUES

LVMH ended down 3.67% after reporting on Tuesday a decline in its sales in the third quarter, dragging down Kering (-0.82%), Hermès (-1.34%), Oréal (-2.17%), Richemont (-0.90%) and Burberry (+1.33%), in a movement of distrust on values ​​exposed to China.

ASML lost 5.31% after the Dutch giant lowered its annual sales forecast in a context of weakening demand for chips not linked to artificial intelligence (AI) technologies.

Just Eat Takeaway fell 9.03% as the food delivery company missed expectations for gross transaction value in the third quarter.

Adidas fell 6.26% despite revising its full-year sales and profit forecast upwards, as the shoe maker suffered from sell-offs in the European personal goods sector (-1. 57%).

TODAY’S INDICATORS

British inflation fell more than expected in September, to 1.7%, according to data from the Office for National Statistics (ONS).

CHANGES

The dollar rises 0.15% against a basket of benchmark currencies in anticipation of a moderate rate cut by the Fed in November and a possible victory for Donald Trump in the US presidential election.

The pound sterling fell 0.52% to 1.3005 dollars, after falling to 1.2988 dollars, the lowest in two months, following the publication of British inflation figures.

The euro lost 0.11% to 1.0878 dollars, on the eve of the monetary policy decision of the European Central Bank (ECB), which should opt for a 25 basis point reduction in its deposit rate.

“Christine Lagarde (the president of the ECB) should not depart from her traditional cautious speech but we remain convinced that we have indeed entered a cycle of lower rates which should continue in 2025”, writes Emmanuel Auboyneau, associate manager at Amplegest.

RATE

The ten-year German Bund yield fell by more than five basis points (bp), to 2.176%, while its American equivalent of the same maturity declined by 4.1 bp, to 3.9985%, after a recent series of increases which brought it to a two and a half month high, at 4.12%.

OIL

The oil market continues its decline against a backdrop of doubts about demand: Brent drops 0.84% ​​to 73.63 dollars per barrel and American light crude (West Texas Intermediate, WTI) falls by 0.96% to 69.89 dollars.

“Current geopolitical tensions, combined with weak demand projections, create an uncertain outlook for global crude prices in the near term,” writes Christopher Tahir, market strategist at Exness, who sees increased volatility in crude.

Brent crude fell more than 4% on Tuesday, near a two-week low.

(Written by Claude Chendjou, edited by Zhifan Liu)

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