2023-05-24 13:10:17
(Photo: The Canadian Press)
MARKET REVIEWS. European stock markets are on track for their worst session since the March banking panic on Wednesday, as tension and risk aversion spread across all markets ahead of the stalled US debt negotiations.
Stock indices
London et Paris plunged 1.5% at the start of the session in Europe, and Frankfurt by 1.3%.
In New York, before the markets open, the average Dow Jones of industrial stocks and the broader index S&P 500 slipped 0.3%.
In Asia, the Nikkei 225 lost 0.9% in Tokyo. The scholarship of Shanghai has melted by 1.3% and the Hang Seng 1.6% in Hong Kong. Sydney lost 0.6% and the Kospi remained stable in Seoul.
On the New York Commodities Exchange, the price of oil added 97 cents US to US$73.88 a barrel.
The context
European stock markets are heading for a third consecutive session of decline. Paris (-1.84%) was at its lowest since March 30, Frankfurt (-1,67%) et Milan (-2.33%) also suffered.
The index Eurostoxx 600 fell 1.73%, on the way to its worst session since March 15.
London (-1.81%) also fell, to the lowest since April 6. British inflation certainly slowed significantly in April, to 8.7% over one year, but it once once more stood well above analysts’ expectations. However, this is the first time since August 2022 that the price increase has fallen below 10%.
Wall Street is also heading for a lower open, but much more moderately than in Europe (-0.4%), according to futures contracts for the three main New York indices.
In Asia, Tokyo (-0,89%), Hong Kong (-1,62%) et Shanghai (-1.28%) ended in the red.
The teams of American President Joe Biden and the negotiators of the Republican camp once more sought Tuesday, without immediate success, a delicate budgetary compromise.
As a result, while the threat of a payment default has not really worried the markets so far, “operators are starting to hedge their portfolios once morest the risk of a decline” linked to this prospect, observed Pierre Veyret, analyst at Active Trade.
On the bond market, short-dated rates continue to tighten. The yield on 3-month US government bonds remained near its 22-year high at 5.29%. The rate for the 10-year loan was almost stable, at 3.68%.
Moreover, the nervousness of market players might also be increased by the publication at 1 p.m. of the minutes of the last meeting of the American central bank (Fed), at the beginning of May, at the end of which its president Jerome Powell had opened the leads to a pause in rate hikes.
Since then, the markets have tightened their monetary policy expectations for the coming months, following several speeches perceived as less accommodating by members of the Fed.
Marks and Spencer at checkout
The company jumped 12.62% in London following the announcement of its financial results, which were welcomed by investors, in particular the prospect of a return to dividends in 2024, underlines Michael Hewson, analyst at CMC Markets. The company’s share price has doubled since hitting a two-year low in October 2022.
Luxury still in trouble
After a session marked by heavy losses on Tuesday, with profit taking and concerns regarding growth in the United States, luxury stocks are still in the red: -1.95% for LVMH-2,45% pour Dry-0,63% pour Hermes-3,41% pour Burberry and -2.63% for Richemont.
On the side of currencies and commodities
The new zealand dollar fell by almost 2% once morest the dollar following the meeting of the national central bank, which raised its main key rate to its highest level since December 2008, as expected, but which also considered that it was the last time that it did.
The euro fell 0.12% to $1.0757, a seven-week low.
Oil prices rose: +1.56% for a barrel of North Sea Brentat US$78.04, +1.71% for the American WTIà 74,16 $US.
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