by CORENTIN CHAPRON

PARIS (Reuters) – The main European stock markets are expected to decline at the opening on Friday, with investors positioning themselves cautiously for new indicators.

Futures contracts suggest an opening down 0.22% for the Parisian CAC 40, 0.11% for the FTSE in London, 0.11% for the Dax in Frankfurt and 0.25% for the EuroStoxx 50.

Many indicators are expected during the session in the euro zone, including inflation in France (7:45 a.m. GMT) and for the bloc (10:00 a.m. GMT).

These two indicators will be scrutinized by the markets because they will make it possible to gauge the room for maneuver of the European Central Bank during its next meeting, on December 12.

The anemic activity in the euro zone indeed calls for a rapid and significant reduction in rates in order to support the economy, but more persistent inflation could limit the extent of these future reductions: wage growth in the bloc has thus displayed stronger than expected in the third quarter.

Conversely, preliminary inflation in Germany in November, published on Thursday, was slightly lower than expected by consensus.

So the next few data points will be critical.

In Japan, underlying inflation in Tokyo increased by 2.2% year-on-year in November, according to data published on Friday, pushing operators to position themselves for a further rate hike from the Bank of Japan.

Investors believe that a 25 basis point increase is 58% likely at the institution’s next meeting.

Trading volumes are expected to remain low with most US operators absent. Closed Thursday for Thanksgiving, the New York Stock Exchange will close earlier this Friday.

VALUES TO FOLLOW:

A WALL STREET

The New York Stock Exchange was closed Thursday for Thanksgiving.

IN ASIA

The Tokyo Stock Exchange fell under pressure from a stronger yen, supported by the latest inflation figures in the capital. The Nikkei index lost 0.37% to 38,208.03 points. The broader Topix lost 0.24% to 2,680.71 points.

Banks and insurance companies rose, supported by expectations of rate increases. Dai-ichi Life Holdings gained 3.5% and Chiba Bank 4.2%.

Chinese markets advanced, with investors betting on a recovery in industrial activity in November, an indicator expected on Saturday. The Hong Kong Hang Seng index increased by 0.03%, the Shanghai SSE Composite strengthened by 0.93%, the CSI 300 by 1.14%.

RATE

US yields vary little in the absence of catalysts.

The ten-year Treasury rate declined by 2.7 bps to 4.2149%, while the yield on the two-year security fell by 1.5 bps to 4.1983%.

The German ten-year yield is stable at 2.127%, that of the two-year rate loses 1.2 bp to 1.99%, after a weaker than expected retail sales indicator in Germany in October.

CHANGES

The yen jumped against the dollar after the publication of an inflation indicator still above the central bank’s target.

In Asia, the yen advanced 1.09% to 149.89 yen per dollar, the Australian dollar rose 0.26% to 0.6516 dollars.

The dollar fell by 0.31% against a basket of reference currencies, the euro rose by 0.27% to $1.0581 and the pound sterling strengthened by 0.28% to $1.2723.

OIL

Oil is progressing moderately, with Israel and Hezbollah accusing each other of violating the truce established on Wednesday while the postponement of the OPEC+ meeting raises questions about the evolution of the crude supply.

Brent rose 0.04% to $73.31 per barrel and American light crude (West Texas Intermediate, WTI) rose 0.63% to $69.15.

MAIN ECONOMIC INDICATORS ON THE AGENDA FOR NOVEMBER 29:

COUNTRY GMT INDICATOR PERIOD PREVIOUS CONSENSUS

FR 07:45 HICP inflation (Nov. 1 +0.0% +0.3%

estimate)

– over one year +1.7% +1.6%

FR 07:45 GDP (definitive) Q3 +0.4% +0.4%*

– over one year +1.3% +1.3%*

FR 07:45 Oct. consumer spending +0.1% +0.1%

households

FROM 8:55 a.m. Unemployment rate Nov. 6.1% 6.1%

EZ 10:00 a.m. Inflation (1st estimate) Nov. +2.3% +2.0%

*first estimate

(Written by Corentin Chappron, edited by Augustin Turpin and Blandine Hénault)

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