by Mara Vilcu
(Reuters)-Wall Street is expected up on Monday and European scholarships are in the red in mid-session, with the anticipations of new rate drops in the United States, where the “Shutdown” enters its sixth day without a budget agreement in sight and with a political situation in France that worries.
Futures in New York indices report an opening of Wall Street up 0.17% for the Dow Jones, 0.38% for Standard & Poor’s 500 and 0.6% for the Nasdaq. The Paris Stock Exchange is in red on Monday, the yields of the French debt are stretched and the euro depreciates, while the second economy With the resignation of the Prime Minister, Sébastien Lecornu. In Paris, the CAC 40 lost 1.61% to 7,958.38 points around 10:47 GMT.
In Frankfurt, the Dax loses 0.01% and in London, the FTSE 100 abandons 0.05%.
The Eurostoxx 50 index is down 0.44%, the FTSEURofirst 300 fell 0.11%and the Stoxx 600 abandons 0.16%.
In the United States, the “Shutdown” continues while another vote failed on Friday in the Senate and that President Donald Trump threatened to further reduce the funding granted to the Democratic States and to dismiss more federal officials.
For the moment, the closure of the federal government, which has been going on since last Wednesday, has had no effect on the markets, more concentrated on monetary policy and the prospects of promising sectors such as artificial intelligence.
However, it has already delayed the publication of certain important macroeconomic indicators, such as the US employment report on Friday. However, a series of alternative indicators published last week reported moderate hires, strengthening anticipations of a decrease of 25 basic points of interest rates by the American Federal Reserve (Fed) at his next meeting.
In Europe, the eyes are riveted on France, where Prime Minister Sébastien Lecornu presented his resignation to Emmanuel Macron on Monday, in the aftermath of the presentation of a “tightened” team of 18 members, which was strongly criticized both by the right, including part of its members and by the left.
The resignation of Sébastien Lecornu marks a new turning point in the worsening of the political crisis in France. “It is worrying that the new government only lasted 12 hours,” notes Kirsty Kundby-Nielsen, analyst at Danske Bank.
“The biggest concern for the markets is really to know what will happen next, because if Macron decides to appoint another Prime Minister, it will be the sixth in two years,” said Michael Brown, senior research strategist at Pepperstone.
Regarding economic data, investors learned on Monday that investor morale in the euro area has improved more than scheduled in October, while global economic feeling has improved despite the American “Shutdown” which started on October 1. The values ​​to follow at Wall Street [L5N3VN0CV]
Values ​​in Europe
In Paris, Société Générale, BNP Paribas and Crédit Agricole, lost between 4.37% and 5.61%.
In London, Aston Martin fell by 7.20% after issuing a warning on its annual results.
RATE
OAT’s yield at ten years takes 7.7 base points at 3.5885%, while that of the 30 -year obligation climbs from 9.2 base points to 4.4.4243%.
The yield gap between German obligations, reference in the euro zone, and French obligations at 10 years, which reflects the risk premium required by investors to hold French debt, stands for 86.08 basic points.
Changes
Politics dominates the currency markets on Monday, the Japanese yen having recorded his strongest decrease in the dollar for five months, while Sanae Takaichi seemed in the process of becoming the next Prime Minister of Japan, while the euro falls after the announcement of the resignation of the French Prime Minister.
The Japanese yen drops by 1.96% to 150.33 yen for an American dollar.
The dollar earns 0.74% against a basket of reference currencies.
The euro lost 0.68% to $ 1.1661.
OIL
Oil prices are increasing on Monday after the expected increase in OPEC+ production for November has proven more modest than expected, temperating certain concerns about the increase in supply, even if the gloomy prospects for demand should limit short -term gains.
The Brent advances 1.66% to 65.60 dollars per barrel and the American light crude (West Texas Intermediate, WTI) takes 1.71% at 61.92 dollars.
No more economic indicator at the agenda of October 6.
(Some data may accuse a slight offset)
(Written by Mara Vîlcu, edited by Kate Entringer)
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