2023-05-22 17:54:22
Paris fell by 0.18%, Frankfurt by 0.32%, Milan by 0.76%, while London rose by 0.18%. In Zurich, the SMI lost 0.15%.
Western stock markets vary in small amplitudes Monday, struggling to find a reason to go up or down while negotiations around the US debt ceiling are almost the only item on the agenda.
European stock markets ended without a clear direction. Paris fell by 0.18%, Frankfurt, which had broken a record in session and at the close on Friday, by 0.32%, Milan by 0.76%, while London rose by 0.18%. In Zurich, the SMI lost 0.15%.
Wall Street also evolved in a mixed way around 3:55 p.m. GMT: the Dow Jones yielded 0.14%, the S&P 500 gained 0.16% and the Nasdaq 0.43%.
On the bond market, sovereign rates rose slightly, by around 0.05 percentage point in Europe and the United States for ten-year maturities.
Notable exception: The Athens Stock Exchange’s Athex index jumped 6.09% following the right-wing’s landslide victory in the legislative elections, which called for a new ballot ‘perhaps June 25’ to seize of an absolute majority. The index returned to its highest level since 2014.
President Joe Biden and Republican Leader Kevin McCarthy are meeting in person on Monday to continue negotiations regarding ten days before the default deadline.
Global markets had risen last week along with the talks, but a change in tone from Mr. McCarthy on Friday had given less relief to the last session.
For Patrick O’Hare of Briefing, “the market is certainly very attentive to the situation but it does not appear outrageously worried”.
Many observers anticipate that an agreement will be reached sooner or later and will avoid a default of payment by the United States, the two parties being convinced that such a scenario would have too serious consequences.
The Fed’s monetary intentions were also at the center of the week’s concerns, as new data on inflation and consumption will be available on Friday (the PCE index for April). A revision to first-quarter GDP growth is also expected on Thursday.
“Minneapolis Fed President Neel Kashkari, who is categorized as someone wanting a 0.25 percentage point rate hike in June, was a bit more pragmatic this weekend,” reports Nicolas Budin. , head of equity management for Myria AM.
The dollar remained stable in the face of vagueness around the Fed’s future monetary policy decisions. The euro fell 0.05% to 1.0799 dollars.
China vs USA
Semiconductor maker Micron Technology fell 3.34% as China accuses the American group of having security failures and calls on companies to stop buying its chips.
Tensions between China and the United States are a “subject of vigilance” for Nicolas Budin. “We don’t see any escalation in tensions, but this is part of this pattern and following a G7 summit,” he explains.
The leaders of the G7 countries warned on Saturday that any attempt at “economic coercion” would have “consequences”, implicitly targeting China’s practices but without naming it. They also said they were “gravely concerned” regarding the situation in the South China Sea.
Ryanair above the clouds
Irish airline Ryanair (+1.31%) returned to profit in its staggered annual financial year ending at the end of March, posting a positive result of 1.4 billion euros, driven by “the strong recovery in traffic” and despite operating costs up 75%. It had suffered a net loss of 355 million euros a year earlier.
Traffic “is now 13 to 14% higher than our pre-Covid volumes,” said Ryanair boss Michael O’Leary.
On the raw materials side
Oil prices are moving up slightly, supported by the prospect of a potential OPEC+ supply cut. The barrel of Brent from the North Sea was worth 75.95 dollars (+0.49%), around 3:50 p.m. GMT, while the American barrel of WTI was worth 72.06 dollars (+0.71%).
The price of natural gas in Europe fell below 30 euros per megawatt hour (-2.87% to 29.31 euros).
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