2023-06-27 14:01:29
(Photo: The Canadian Press)
MARKET REVIEWS. European stock markets erased their gains to return to equilibrium on Tuesday, in reaction to remarks by the President of the European Central Bank (ECB), Christine Lagarde, on raising rates.
Stock market indices at 8:30 a.m.
Global markets were up on Tuesday morning, the day following a rather difficult session in New York.
Frankfurt fell 0.1% at the start of the session in Europe. London added 0.2% and Paris 0,3%.
In New York, before the markets open, the average Dow Jones of industrial stocks and the broader index S&P 500 took 0.2%.
In Asia, the Nikkei 225 slipped 0.5% in Tokyo. The scholarship of Shanghai fell 1.2% and the Hang Seng accelerated by 1.9% in Hong Kong. Sydney took 0.6% and Seoul was stable.
On the New York Commodity Exchange, the price of oil added 45 cents to US$69.82 a barrel.
The context
European markets were cooled by a speech by Christine Lagarde at the ECB forum in Sintra (Portugal), where she assured that “unless there is a significant change in (its) outlook”, the ECB would continue “raising rates in July” .
This would then be the ninth increase in its key rates.
The interest rate on the German 2-year loan stood at 3.0747%, following rising to 3.0951% in the wake of Christine Lagarde’s announcements, once morest 3.0675% at the close on Monday.
The anticipation of an ECB rate hike had more impact on shorter-term rates on Tuesday, with 10-year rates still in favor with investors.
The yield on German 10-year bonds thus reached 2.2949% once morest 2.305% at the close on Monday.
The markets will also watch on Wednesday in Sintra the statements of the president of the American central bank (Fed), Jerome Powell.
European stock markets weakened following taking advantage of Chinese Premier Li Qiang’s remarks on China’s good growth prospects at the start of the session, while the situation in Russia seems to have stabilized.
The Chinese leader explained at the opening of the World Economic Forum in Tianjin (north China) on Tuesday that his country was hopeful of “reaching the growth target” set by Beijing at 5% in 2023.
However, “the macroeconomic momentum (of the country) shows few clear signs of recovery,” noted Stephen Innes, analyst at SPI Asset Management.
For its part, Wall Street was heading for a half-hearted opening.
After a drop of 1.16% the day before, weighed down by Alphabet and Tesla, the Nasdaq took 0.39% in pre-market trading, the S&P500 gleaned 0.15% and the Dow Jones lost 0.05%.
Among the indicators expected on Tuesday, investors will watch durable goods orders and new home sales for May in the United States.
Consumer confidence in June and the PCE index, preferred by the Fed to measure inflation and therefore particularly scrutinized by the markets, will be published on Friday.
Amid slowing markets, “stronger rhetoric from global central banks puts investors at even greater downside risk, especially if this week’s inflation data is strong,” Innes said. in a note.
Side stitch for JDSports
The action of the clothing distributor JDSports Fashion fell 5.49% in London, following a communication to shareholders before their general meeting indicating that sales in the United States “are slowing down”, even if stocks there remain at “normal” levels.
Prosus simplifies and advances
The Dutch technology investment fund Prosus took 5.61% to 66.80 euros, signing one of the largest increases in the European Stoxx 600 on Tuesday.
The title reaped the benefits of the announcement of its results and particularly the simplification of its links with the South African Naspers in its shareholder structure.
Rise in oil, euro and bitcoin
The barrel of North Sea Brent, for August delivery, fell 1.13% to US$73.35. Its American equivalent, the barrel of West Texas Intermediate (WTI)for same month delivery, was down 1.11% to US$68.60.
The reference European contract price for natural gas, Dutch FTTtook 1.13% to 32.34 euros.
The euro was up 0.41% at $1.0950.
The bitcoin gained 1.44% to US$30,596.
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