by Diana Mandia

(Reuters) – European scholarships finished in dispersed order on Tuesday, the remaining prudence of focus while the calendar to achieve trade agreements between Washington and its main parties is increasingly tight.

In Paris, the CAC 40 finished rather stable (-0.04%) at 7,662.59 points and, in Frankfurt, the Dax fell 0.8%. In London, the FTSE 100 turned upwards towards the end of the session to finish on a gain of 0.28%.

The Eurostoxx 50 index lost 0.39%, the FTSEUROFIRST 300 0.18%and the STOXX 600 0.21%.

Caution dominated the first market session in July, the concerns about the commercial issue that has resurfaced as the deadline of July 9 approaches so that countries reach an agreement with the United States in order to avoid severe surcharge likely to affect growth and raise prices.

According to European diplomats, Brussels wishes an immediate reduction in customs duties to key sectors, but expects to have a certain degree of asymmetry, even in the best of cases.

The European Commerce Commissioner, Maros Sefcovic, and the chief of staff to the president of the European Commission, Bjoern Seibert, will go to Washington this week in the hope of reaching an agreement.

The American senators also voted on Tuesday the budgetary “big and beautiful law” of Donald Trump which must now be examined in the House of Representatives while investors are concerned with swelling of the American public debt.

Investors also digest the words of central bankers participating in the European Central Bank forum (ECB) in Sintra (Portugal).

Speaking in the Portuguese city, the president of the American Federal Reserve (Fed), Jerome Powell, has once again been cautious about the drop in interest rates so desired by Donald Trump, assuring that the decision would depend on economic data.

VALUES

VusionGroup lost 10.2% after a sale of its shares by Walmart via an accelerated private investment.

The Umicore action took 11.7%, the Belgian specialty chemistry group having revised upwards its forecasts.

After the start of session in the red, Renault ended up 2.65% despite the announcement of a net loss estimated at 9.5 billion euros on its participation in Nissan in the first half.

A Wall Street

At the time of the fence in Europe, the Dow Jones turned upwards and won 1.11%, while the Standard & Poor’s 500 lost 0.28%and the Nasdaq Composite yields 1.01%, weighed down by Tesla (-4.8%) and by prudent remarks of Jerome Powell on the rates.

The indicators of the day

Inflation increased to 2% in June in the euro zone, against 1.9% the previous month, in accordance with the expectations of a reuters survey and the objective of the ECB.

At the same time, manufacturing activity in the euro zone showed new signs of recovery in June, new orders that have ceased to drop for the first time in more than three years.

In the United States, manufacturing activity remained rather sluggish in June, which suggests that the customs duties of the American administration on imported goods continued to hinder the capacity of companies to plan in advance.

The number of job offers in the first economy in the world has also increased in May unexpectedly, highlighting the resistance of the labor market despite commercial and economic uncertainties.

Changes

The US dollar has reduced its losses to the main currencies after data has shown a greater increase than expected from job offers, indicating that the federal reserve will probably take its time to reduce interest rates.

The greenback grabbed 0.01% against a basket of reference currencies at the time of the closing of the markets in Europe, while the euro yields 0.12% to 1.1772 dollars.

The dollar, however, depreciated for most of the Tuesday session, due to concerns related to the American budget and to the trade.

RATE

The yields of the Euro zone bonds fell slightly on Tuesday, while inflation in the block has returned to the target of the ECB.

The yield of the German Bund at ten years has lost 3 base points at 2.5670%. The two years fell from a base point to 1.8440%.

In the United States, return is up after the publication of job offers.

The yield of Treasuries at ten years takes nearly 5 base points at 4.2749%. The two years advances from 6.2 base points to 3.7827%.

OIL

Oil prices are growing slightly, investors assessing expectations that OPEC+ will announce an increase in production for the month of August at a next meeting, while monitoring negotiations between the United States and its business partners.

Brent took 0.25% at 66.91 dollars per barrel and American light crude (West Texas Intermediate, WTI) advances from 0.37% to 65.35 dollars.

To be continued on July 2:

(Written by Diana Mandiá, edited by Blandine Hénault)

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