2024-04-10 16:41:37
In Europe, the indices went through all phases during the session: rising at the start, falling sharply with the announcement of American inflation – the CAC 40 fell back below the 8,000 point mark for the first time in a year. month – before recovering at the end of the session, to finish almost stable (-0.05%). Frankfurt and London closed slightly higher, gaining 0.11% and 0.33% respectively.
At 4:10 p.m. GMT, Wall Street was still trending sharply lower: the Dow Jones lost 1.31%, the Nasdaq lost 1.17% and the broader S&P 500 index lost 1.18%. The New York Stock Exchange is stunned by the acceleration of inflation, which casts doubt on the very idea of a rate cut this year by the American central bank (Fed).
Economists were already counting on an acceleration in inflation over one year – to 3.4% compared to 3.2% in February – but this turned out to be even more marked, at 3.5%, still very far from the Fed target of 2%.
“Housing and gas are the two key factors” explaining this increase above expectations, estimates Jack Amy, analyst at Moneyfarm.
Investors are increasingly doubtful that the Fed will lower its key rates in June, especially since the economy across the Atlantic remains as solid as ever. They now consider it more likely to have only two rate cuts over the whole of 2024: a month ago, they were planning on three.
“The key question now is whether this will really deter the Fed and the type of communication it will make in the coming times” on this subject, underlines Neil Wilson, analyst at Finalto.
The report of the discussions of the last monetary policy meeting of the Fed is expected in the second part of the session in the United States.
The announcement of US inflation also immediately caused rates to rise on the bond market. The American 2-year interest rate, the most sensitive to monetary policy, soared to 4.93% at 4:00 p.m. GMT, the highest since November 27, compared to 4.74% the day before. In Europe, 10-year interest rates followed the same trend: 2.92% for France and 2.43%, compared to 2.86% and 2.37% respectively the day before.
Delta Air Lines takes off ___
The American airline Delta Air Lines exceeded analysts’ forecasts in the first quarter, marked by “record” turnover and “robust” demand, which confirms its objectives for the whole year.
Over the first three months of the year, the company achieved a turnover of 12.56 billion dollars (+6%) and generated a net profit of 37 million, compared to a loss of 363 million a year earlier. . Resisting the sharp drop in trading at the opening of the New York Stock Exchange, Delta shares rose 1.30% at 4:10 p.m. GMT.
The dollar is soaring ___
Another consequence of inflation, around 4:00 p.m. GMT the greenback climbed once morest the euro, which plunged to 1.0735 dollars, and also jumped once morest the pound, which fell by 0.91% to 1.2562 dollars.
The dollar strengthened following “hopes of an imminent Fed rate cut were dampened by higher-than-expected inflation” on top of strong jobs and growth data, says Jason Schenker of Prestige Economics.
Bitcoin lost 0.64% to $68,687.
Oil prices advanced Wednesday, with a report from the U.S. Energy Information Administration revising demand upward.
A barrel of Brent rose 0.19% to $89.59, just like WTI, up 0.18% to $85.38 around 4:00 p.m. GMT.
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