by Claude Chendjou
PARIS (Reuters) – European stock markets ended lower on Wednesday and the trend was also negative on Wall Street at mid-session, with investors showing nervousness before the publication of Nvidia’s quarterly results and after Target’s disappointing financial forecasts for the end of year celebrations, while geopolitical tensions do not subside.
In Paris, the CAC 40, which had opened in the green, fell again, closing down 0.43% at 7,198.45 points. The British Footsie lost 0.17% and the German Dax lost 0.31%.
The EuroStoxx 50 index fell 0.45%. The FTSEurofirst 300 gained 0.01%. The Stoxx 600 fell 0.02%, recording a fourth consecutive session in the red.
At the close in Europe, the Dow Jones fell by 0.03%, the Standard & Poor’s 500 by 0.32% and the Nasdaq by 0.40%.
Nervousness, fueled on Tuesday by fears of worsening tensions between Russia and Ukraine, ended up winning out on Wednesday at the close of the European stock markets after an attempt at a rebound during a large part of the trading.
The VIX index in the United States, which reached its highest session on Tuesday since the American election of November 5 before falling, started to rise again on Wednesday, jumping by more than 11%, to 18.2 points, while its European equivalent was close to the 20 point mark.
The US embassy in Kyiv closed its doors on Wednesday in anticipation of possible Russian attacks, while warning sirens sounded in the Ukrainian capital and other parts of the country.
In addition to geopolitical fears, Nvidia, down 1.22% before the publication of its results in the evening, is weighing on investor sentiment.
Options markets show that Nvidia stock could move up or down nearly $300 billion after the release of its financial results, a swing of 8.5% in either direction, prompting to caution. Nvidia’s stock has nearly tripled since the start of the year, accounting for about 20% of the S&P 500’s returns over the past 12 months, according to BofA Global Research.
Furthermore, the American distributor Target fell by more than 21% after announcing that it anticipated comparable sales and profits lower than expected for the quarter including the end-of-year holidays, which weighs on its entire sector, in particular. decline of 1.33%.
In Europe, the distribution index ended down 0.45% and that of cyclical consumption down 0.62%, while the technology sector, one of the drivers of the good performance in the morning of shares, erased all its gains at the end of the session, to be down 0.05%.
VALUES IN EUROPE
STMicroelectronics lost 1.22% after pushing back its long-term financial targets by three years on Wednesday.
Elior fell 24.29%, with the group anticipating a slowdown in its turnover growth over 2024-2025.
La Française des Jeux (FDJ) fell 4.37%, Crédit Agricole Assurances having announced that it had sold shares of the gaming group at a discount of 7% compared to Tuesday’s closing price.
Edenred advanced 1.99% thanks to an increase in Jefferies’ recommendation from “underperformance” to “hold”.
Sage soared 17.87%, the British software publisher having reported an increase in its annual profit and announced a share buyback plan.
INDICATOR OF THE DAY
British inflation rebounded a little more than expected in October, to 2.3% year-on-year.
CHANGES
The US dollar resumes its march forward on Wednesday after three sessions of decline while a Reuters survey shows that the pace of reductions in borrowing costs by the US Federal Reserve (Fed) in 2025 will be less than initially expected due to the inflationary policy that Donald Trump should put in place.
The dollar index, which measures the fluctuations of the greenback against six reference currencies, rose 0.67% to 106.82 points, after having increased by around 3% since the election of Donald Trump.
The euro fell by 0.73%, to $1.0518, and the pound sterling by 0.36%, to $1.2635.
Bitcoin, which reached a record overnight from Tuesday to Wednesday at more than $94,000, advanced 1.59% to $93,787 at the close of trading in Europe. The digital currency is driven by the prospect of a more favorable regulatory environment with the return of Donald Trump to the White House.
RATE
Eurozone bond yields experienced a volatile session between ongoing tensions between Russia and Ukraine and data released Wednesday by the European Central Bank (ECB) showing an acceleration in the growth of negotiated wages in the bloc in the third quarter , which could reinforce the institution’s caution regarding a rapid reduction in its key rates.
The ten-year German Bund yield ended practically stable, at 2.345%, after having oscillated between 2.336% and 2.389%.
In the United States, the yield on ten-year Treasury bonds rose by 1.9 basis points, to 4.3962%, with the rise of the dollar.
OIL
Oil prices were virtually unchanged on Wednesday, with investors torn between fears of an escalation in the Russian-Ukrainian conflict and the rise in US crude stocks last week.
Brent declined 0.01% to $73.30 per barrel, while American light crude (West Texas Intermediate, WTI) gained 0.23% to $69.55.
(Written by Claude Chendjou, edited by Jean-Stéphane Brosse)
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