2023-08-15 14:02:05
(Photo: The Canadian Press)
MARKET REVIEWS. World stock markets fell on Tuesday, weighed down by disappointing economic indicators from China, whose economic growth is as worrying as the health of its real estate sector, and pending data in the United States.
Stock market indices at 8:30 a.m.
In Europe, variations in stock market indices tend to be exacerbated in August due to the absence of many investors, especially since Tuesday is a public holiday in several countries. Paris lost 1.36% and Frankfurt 1.11% around 7:50 a.m., after the publication of a slight improvement in German investor sentiment in August.
London fell by 1.38%. In the UK, the jobless rate rose to 4.2% for the three months to the end of June compared to the previous quarter, while wage growth accelerated.
“This will inevitably increase the pressure on the Bank of England for another rate hike at its September meeting,” said CMC Markets analyst Michael Hewson.
The book gained 0.18% against the US dollar (US$) to 1.2706 $US for one pound and the bond interest rates of the British State loan rose (5.13% around 07:45 a.m. against 5 .04% on Monday for the two-year term), just like those of other European countries.
HAS Wall Streetthe three major indices are expected to open down about 0.6% according to their futures at around 7:45 a.m.
Hong Kong fell 1.03% after the publication of a series of indicators in China: retail sales, the main indicator of household consumption, and industrial production came out below analysts’ expectations polled by Bloomberg. As for unemployment figures, China has decided to no longer publish the detail by age, after a record level of unemployment among young people in recent months.
To support activity, the Chinese central bank on Tuesday lowered a reference rate for medium-term loans and injected 400 billion yuan (50.4 billion euros) into the economy.
The context
But for analysts, these measures are not sufficient to revive Chinese growth and “could even be perceived as unfavorable insofar as policymakers start to press the panic button”, estimates Stephen Innes, associate of the manager of SPI AM assets.
Added to this are fears about the real estate sector and particularly the financial health and indebtedness of one of China’s largest real estate groups, Country Garden.
Investors will learn July retail sales and US manufacturing output figures later today, as well as results from US DIY chain Home Depot.
The ruble is recovering
After a sharp drop in the ruble on Monday, weakened by the deterioration of Russia’s trade balance, which reached its lowest level since March 2022 at the time of the invasion of Ukraine, the Russian Central Bank (BCR) announced on Tuesday raise its key rate to 12%.
This announcement allowed the rouble to go up. Against the US dollar it rose 2.29% to 98.49 rubles per dollar around 07:45. Since the start of the year, it has lost more than 25% against the dollar and the euro.
“In the event of heightened inflationary risks, a further increase in the key rate is possible,” the BCR said.
European real estate swept away
The values of the European real estate sector fell sharply on Tuesday, in the wake of fears weighing on the sector in China.
In Frankfurt, Deutsche Wohnen (DWNI.F) yielded 3.48%, Adler (ADL.HM) 8,61% et Kill (KILL) 2,45%.
In Paris, Unibail-Rodamco-Westflied (UL.VI) lost 2.28%, Icade (CDMGF) 2,93% et Gecina (GFC.PA) 1,61%.
In London, British Land Company (BLND.L, -1,10%) et Land Securities (LSGOF, -1,73%) were also dropping around 7:45 a.m.
On the raw materials side
Oil prices continued their small decline around 7:45 a.m., weighed down by fears about demand in China.
The baril de Brent de la mer du Nordfor delivery in October, dropped 0.73% to US$85.58 and its US equivalent, a barrel of West Texas Intermediate (WTI)for September delivery, was down 0.97% to US$81.71.
The futures contract TTF Netherlands, considered the European benchmark for natural gas, rose 7.71% to 37.09 euros per megawatt hour (MWh).
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