NEW DOWNTURN IN VIEW IN EUROPE, THE PMI WILL ENJOY THE MORNING
PARIS (Archyde.com) – The main European stock markets are expected to continue their decline on Tuesday before new indicators which are likely to underline the deterioration in the economic situation and pending clarification on American monetary policy.
Index futures suggest a drop of 0.23% for the CAC 40 in Paris, 0.38% for the Dax in Frankfurt, 0.35% for the FTSE 100 in London and 0.41% for the EuroStoxx 50.
The Paris market lost 1.8% on Monday and recorded its worst closing since July 28, as did the broad European Stoxx 600 index (-1.0%), following a 13% jump in benchmark gas prices. natural in Europe and gloomy economic forecasts in Germany and the United Kingdom.
After the rebound favored in the middle of the summer by better-than-expected corporate results and the first signs of a slowdown in inflation in the United States, investors thus seem to have been suddenly caught up in the reality of the economic slowdown and the fallout from the war in Ukraine.
They will monitor the “flash” PMI indices in the morning to try to better assess the risk of a recession in the coming months: the Refinitiv consensus expects them to confirm the contraction of activity in the private sector in Germany and in the euro area as a whole.
In the United States, the session will also be driven by monthly figures for new home sales, which the rise in interest rates should have dampened in July.
But even in the event of positive surprises, a marked increase in risk appetite is unlikely three days before the highly anticipated intervention in Jackson Hole by Jerome Powell, the chairman of the American Federal Reserve, which should confirm the priority given the fight once morest inflation, and therefore the continued rise in interest rates.
A WALL STREET
The New York Stock Exchange ended sharply lower on Monday, as investors favored assets deemed safer such as government bonds and the dollar as concerns mount over the risk of recession and monetary tightening.
The Dow Jones index fell 1.91%, or 643.13 points, to 33,063.61, the Standard & Poor’s 500 lost 90.49 points, or 2.14%, to 4,137.99 (its worst daily performance since June 16) and the Nasdaq Composite fell 323.64 points (-2.55%) to 12,381.57.
The 11 major S&P sector indices ended in the red and among the most marked declines, the technology compartment lost 2.78%, the values of this sector being more sensitive to the evolution of rates.
Apple, Microsoft, Amazon and Nvidia lost 2.30% to 4.57%.
On the rise, Signify Health jumped 32.03% following reports from Bloomberg that UnitedHealth, Amazon, CVS Health and Option Care Health each made a bid to get their hands on the home health service provider. .
Futures contracts on the main indices for now point to an opening down 0.2% to 0.5%.
IN ASIA
On the Tokyo Stock Exchange, the Nikkei index ended down 1.19%, once once more weighed down by technology stocks in the wake of the Nasdaq’s decline: SoftBank for example dropped 2.42%, Tokyo Electron 0, 79%.
Chinese stocks are not immune to the decline either: the Shanghai SSE Composite, which rose at the start of the session, now gives up 0.02% and the CSI 300 is down 0.36% with the further decline in real estate values (- 1.64%).
CHANGES
The dollar, which was marking time in the first exchanges in Asia, started to rise once more once morest the other major currencies (+0.05%), which translates for the euro into a new low of more than 20 years. at 0.9915 (-0.26%).
The general retreat into safe havens also pushed the pound to its lowest level in two and a half years while the yen hit a one-month low.
RATE
In the bond market, US benchmark yields fell a little following finishing higher on Monday ahead of Jerome Powell’s intervention in Jackson Hole.
The ten-year returned to 3.0109% following a five-week high at 3.039% and the two-year fell more than three basis points to 3.2954%.
In Europe, the ten-year German varies little in the first exchanges but, at 1.286%, it remains at its highest since July 21.
OIL
Oil prices are on the rise following Saudi Arabia issued a warning of a possible OPEC+ production cut in response to falling prices in recent weeks.
Brent gained 0.45% to 96.91 dollars a barrel and US light crude (West Texas Intermediate, WTI) 0.53% to 90.84 dollars.
The risk of OPEC+ supply cuts outweighs the still very uncertain prospect of an Iranian nuclear compromise.
(Written by Marc Angrand, edited by Matthieu Protard and Kate Entringer)
