by Mara Vilcu and Diana Mandia

(Reuters) – The European scholarships ended up on an increase on Friday, carried by the agreement of the parties of the future German coalition on the reform of the “debt brake” in order to increase defense spending and revive the growth of the first European economy.

In Paris, CAC 40 won 1.13% at 8,028.28 points. In Frankfurt, the Dax advanced 1.65% and London, the FTSE 100 took 1.05%.

The Eurostoxx 50 index ended up 1.34%, the FTSEUROFRST 300 won 1.12%and the Stoxx 600 took 1.11%.

Over the week, the CAC 40 abandoned 1.13% and the Stoxx 600 lost 1.25%, their worst weekly performance since mid-December.

The Christian Democratic Union (CDU) of the future Chancellor Friedrich Merz, the Social Democratic Party (SPD) and the German Greens reached an agreement on the relaxation of federal debt rules on Friday, which made the bond yields of the euro zone jump, as well as the actions and the single currency.

The CDU and the SPD should therefore now have the majority of two thirds necessary to adopt the reform, the last sign of a rapid development of defense and infrastructure spending in the light of changes in American foreign policy under Donald Trump.

According to economists, this reform should support long -term growth in Germany, faced with two consecutive years of contraction, and in the European Union (EU).

“Overall, this is a good thing. It will unlock growth for Germany and, more importantly, it may unlock a new economic paradigm for Europe,” said George Lagarias, chief economist at Forvis Mazars.

“Basically, Europe is advancing and it is something that markets and investors have been waiting for a long time,” he added.

On the macroeconomic front, the final data on German inflation, which show a slight decrease in February to 2.6% over a year, were well received when they should support the bets of a new softening of the monetary policy of the ECB.

However, concerns about American customs duties and their impact on the economy persist and have weighed on the markets over the whole week, especially in the United States, where Nasdaq and Standard & Poor’s 500 entered the correction zone as the trade war was confirmed.

The outcome of the conflict in Ukraine also remains uncertain, Donald Trump having however mentioned on Friday mentioned a “very good” exchange of his emissary with Vladimir Putin in Moscow and says he is hopeful of seeing the conflict ends.

VALUES

The European Defense sector (+3.91%, 3.92% over the week) had a new day of strong increases on Friday, supported by the debt brake agreement in Germany.

In France, Thales ended at the top of the CAC 40 index with an increase of 5.57%, while Safran took 2.28%.

Rheinmetall AG took 6.29% and Leonardo Spa 7.13%.

Kering lost more than 10% on Friday, red lantern of the CAC 40 after the announcement Thursday evening of the appointment of Demna Gvasalia, who calls himself Demna, to the post of artistic director of the Gucci brand, analysts being unconvinced by the choice of the French luxury group.

A Wall Street

At the time of the fence in Europe, the Dow Jones takes 1.39%, the Standard & Poor’s 500 1.80%and the Nasdaq Composite 2.29%.

Crown Castle jumped by 10.33% after announcing that it would sell its fiber optic assets with two entities for $ 8.5 billion, under the leadership of the activist investor Elliott Investment Management.

The indicators of the day

In the United States, household morale has deteriorated more than expected in March and inflation forecasts have skyrocketed while the customs duties announced by President Donald Trump threatens to increase prices and harm the economy.

Changes

The euro increased by 0.29% to 1.0877 dollars, supported by prospects on defense spending in Germany.

The dollar loses 0.14% against a basket of reference currencies.

The Sterling book fell 0.16% against the dollar due to the surprise contraction of the British economy in January.

RATE

Bond European yields are climbing on Friday with the agreement in Germany between conservatives, social democrats and the Greens on debt brake reform.

The yield of the German Bund at ten years ended on a gain of 2.1 base points at 2,8750%. The two years took a base point at 2,1900%.

In the United States, bond yields are also increasing, in response to concerns about the potentially inflationary impact of customs duties.

The yield of Treasuries at ten years old takes 2.3 base points at 4.2986%. The two years advances from 5.1 base points to 4.0044%.

OIL

Oil prices bounce on Friday to recover part of the losses of more than 1% suffered during the previous session, partly due to the uncertainties linked to the prospect of a war stop in Ukraine.

Brent took 0.8% at $ 70.44 per barrel and American light crude (West Texas Intermediate, WTI) gained 0.83% to 67.10 dollars.

Metals

The price of gold exceeded on Friday for the first time the 3,000 dollars mark on Friday, the commercial tensions and betting on the drop in American interest rates that have strengthened its appeal as a refuge value.

The gold is then returned below the 3,000 mark and at the time of the fence in Europe, it appears at 2,989.19 dollars perce.

To be continued on March 17:

(Some data may accuse a slight offset)

(Written by Mara Vîlcu and Diana Mandiá)

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