by Claude Chendjou
PARIS (Reuters) – European stock markets ended sharply lower on Tuesday and Wall Street was also in the red at mid-session, caution now prevailing after the euphoria born from the election of Donald Trump as president of the States -United.
In Paris, the CAC 40 ended down 2.69% at 7,226.98 points. The British Footsie lost 1.22% and the German Dax lost 2.06%.
The EuroStoxx 50 index declined by 2.25%, the FTSEurofirst 300 by 1.99% and the Stoxx 600 by 1.98%.
At the close in Europe, the Dow Jones fell by 0.57%, the Standard & Poor’s 500 by 0.33% and the Nasdaq by 0.20% the day after a closing record for the S&P 500 and ‘a peak since November 2021 for the Russell 2000 small-cap index.
Sentiment in Europe was weighed down first by the values exposed to China, while Donald Trump begins to constitute his future administration and could Senator Marco Rubio, perceived as a “hawk”, at the head of American diplomacy, this which would exacerbate tensions with Beijing.
The European luxury sector, very dependent on China, ended down 3.69%, with notably a fall of 5.76% for Kering, which fell to its lowest level since February 2017. LVMH and Hermes lost respectively 4. 52% and 3.41%.
Basic resources in Europe, another sector exposed to China, fell by 3.98%, amid fears of a trade war between Washington and Beijing.
“The market is now examining the potential risks for the different sectors (linked to the re-election of Donald Trump),” underlines Patrik Schwendimann, analyst at Zurich Cantonal Bank.
VALUES IN EUROPE
OPmobility (formerly Plastic Omnium) dropped 2.43% after announcing its long-term objectives during a press briefing.
Vodafone fell by 8.19% after reporting a decline in the second quarter of its activity in Germany, its main market.
Bayer plunged 14.5% after lowering its operating profit forecast for the full year.
Infineon gained 3.66%, with JPMorgan estimating that the semiconductor manufacturer’s forecast of “moderate” growth in 2025 generally corresponds to investors’ expectations.
Brenntag fell 8.16% as the German chemical distributor reported quarterly profit below market expectations.
TODAY’S INDICATORS
Investor morale in Germany deteriorated in November, according to the Zew index, which stood at 7.4 points, compared to 13.1 in October.
German inflation according to HICP standards was confirmed at 2.4% in October, which marks an acceleration over one year after +1.8% in September.
Wage growth, excluding bonuses, in the UK slowed in the third quarter to its lowest level in more than two years, with average weekly earnings up 4.8%.
CHANGES
The US dollar, up 0.64% against a basket of reference currencies, reached its highest level since early July on Tuesday, above 106 points.
The euro fell 0.54%, to 1.0598 dollars, its lowest since the end of April.
The pound sterling fell 102%, to $1.2734, under pressure from the dollar and today’s economic statistics.
In cryptocurrencies, bitcoin rose to an unprecedented high, at $89,982, supported by Donald Trump’s promise to make the United States the “cryptocapital of the planet”.
RATE
Bond yields in the euro zone experienced a volatile session, with investors having to take into account a series of economic data, the impact of protectionism measures promised by Donald Trump and the prospect of early elections in Germany.
The yield on the ten-year German Bund, the benchmark for the euro zone, ended with a gain of 2.6 points, at 2.352%, after hitting a low during the session since October 30, at 2.299%.
In the United States, the yield on ten-year Treasury bonds jumped 10.6 basis points to 4.4138% while many experts believe that Donald Trump’s political and economic program will exert pressure on the increase in inflation.
OIL
The oil market is rebounding after a fall of more than 5% in the last two sessions, with investors appearing to ignore the new downward revision of OPEC’s global crude demand growth forecasts for 2024 and 2025.
Brent rose 0.49% to $72.14 per barrel and American light crude (West Texas Intermediate, WTI) advanced 0.47% to $68.36.
TO BE CONTINUED ON WEDNESDAY:
Publication at 1:30 p.m. GMT of the consumer price inflation index in the United States
(Written by Claude Chendjou, edited by Jean Terzian)
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I have over 8 years of experience working in the news industry. I have worked as a reporter, editor, and now managing editor at 247 News Agency. I am responsible for the day-to-day operations of the news website and overseeing all of the content that is published. I also write a column for the website, covering mostly market news.
