European markets in decline, technology at the forefront

Frankfurt closed with a drop of 1.13%, Paris of 1.44% and London of 0.53%. In Zurich, the SMI dropped 1.57%.

Stock markets continued to look gloomy Monday, especially technology stocks, amid fears of more severe currency restrictions to fight inflation.

On Wall Street, the Nasdaq, more sensitive to the evolution of bond rates, suffered more once once more: it lost 2.33% around 5:40 pm GMT, following its biggest weekly drop last week. The S&P 500 was down 1.70% and the Dow Jones 1.29%.

European markets also fell sharply, in Frankfurt (-1.13%), Paris (-1.44%) and London (-0.53%). In Zurich, the SMI lost 1.57%.

In the bond market, the trend that began following the release of the US Federal Reserve Policy Brief also continued.

The yield on the ten-year US sovereign loan, an indicator of future interest rates, briefly returned to a pre-Covid level, at 1.80%.

“The rise in inflation, the change in monetary policy and the persistent supply difficulties do not make you want to buy,” says Jochen Stanzl, for CMC Market.

On Wednesday, investors learned that members of the Fed were planning to make four key rate hikes – now at a historically low level – instead of three.

The institution might also reduce its balance sheet, that is to say start selling part of the assets it has bought for 18 months to support prices in the face of the health crisis.

The Fed’s change of tone is being constrained by inflation, which peaked for nearly four decades in the United States in November. New figures are expected for December on Wednesday.

In the euro zone, the inflation rate reached its highest level in 25 years in December, at 5% over one year, also causing a stiffening of the European Central Bank (ECB).

GTA breaks the bank for FarmVille

The American video game publisher Take-Two Interactive, behind the GTA franchise, announced on Monday that it had reached an agreement to acquire the developer Zynga, icon of mobile games, for 12.7 billion dollars.

The publisher tumbled 14.50% to 141.34 dollars, when the developer, which had lost half of its value in 2021, soared 44.58% to 8.68 dollars.

In Paris, Ubisoft also took 4.45% to 42.76 euros in the wake of this announcement.

The highly volatile stock of video game store chain GameStop dropped 11.38% to $ 124.71 following climbing sharply on Friday in the wake of the announcement of partnerships in digital assets and cryptocurrencies.

The air still hovers

Less penalized by the rate hike, and especially looking at the prospects for the reopening of the global economy following the Omicron wave, the airlines were optimistic: Easyjet climbed 1.93% to 633.80 pence while ‘IAG, parent company of British Airways and Iberia, gained 1.07% to 162.74 pence. In Germany, Lufthansa gained 2.86% to 7.27 euros.

The French technology and defense group Thales took 1.63% to 78.78 euros following a contract with the French Air Force.

Bitcoin hits a low since late September

Bitcoin briefly fell below $ 40,000 on Monday, the lowest since late September, suffering in the first sessions of 2022 from investors’ lack of risk appetite. Around 5.35 p.m. GMT, it rose to 40,770 dollars (-3.63%).

The euro dropped 0.25% to 1.1332 dollar following its sharp rise on Friday.

Oil prices fell following a week of rise, notably linked to protests in Kazakhstan.

At around 5:25 pm GMT, the price of a barrel of Brent North Sea for February delivery lost 0.61% to 81.24 dollars.

In New York, a barrel of West Texas Intermediate (WTI) for the same month fell 0.43% to 78.54 dollars.