Look at the stocks, the euro fell after the European Central Bank
by Laetitia Volga
PARIS (Reuters) – Major European stock markets, with the exception of London, are expected to fall slightly on Friday at the open, as investors continue to digest the muscular tightening of the European Central Bank (ECB) to fight accelerating inflation.
The first available indicators point to a 0.26% decrease for the CAC 40 in Paris, a 0.25% decrease for the Dax in Frankfurt and a 0.21% increase for the FTSE in London.
Major stock indexes closed Thursday in a mixed order, torn between good corporate results and a more-than-expected sustained rise in European Central Bank interest rates amid recession fears.
The central bank ended the era of negative interest rates by raising its three key rates by half a point, a larger-than-expected increase to curb record 8.6% inflation in the eurozone.
Its leaders also agreed to provide additional aid to the most fragile countries, such as Italy, through a new bond-buying program (Transport Protection Instrument) aimed at curbing rising borrowing costs, in order to “combat unjustified and undisciplined market dynamics.”
“Unlimited volume and the absence of conditions imposed on eligible countries to use this tool was critical to avoiding significant market disappointment. However, the details of activation limits (eg what level of returns/?), and how this interacts with The political uncertainty in Italy and its legality (whether it will be challenged in court) remains a major unknown,” said Sami Char, chief economist at Lombard Odier.
In political news in Rome, President Sergio Mattarella decided to dissolve Parliament the day after the dissolution of the ruling coalition since February 2021.
The Milan Stock Exchange could drop about 0.7% at the open, according to preliminary indications.
Regarding the macroeconomic situation in Europe, the morning will be moved by the first results of IHS Markit surveys of private sector purchasing managers, PMIs are expected to decline according to the Reuters consensus.
On Wall Street
US “futures” are pointing to a lower open, especially for the Nasdaq – given at -0.87% – after the disappointing results and lack of expectations from Snap, which fell by 25% in post-close trading.
On Friday, the New York Stock Exchange ended up, boosted by results that Tesla considered encouraging, which offset the decline recorded by shares related to the telecom and energy sector.
The Dow Jones rose 0.51% to 32.036.9 points, the S & P-500 increased 0.99% to 3,998.95 points and the Nasdaq Composite rose 1.36% to 12,059.61 points.
Tesla stock jumped 9.78% after reporting better-than-expected results driven by a more favorable pricing policy while AT&T fell 7.62% as the mobile operator cut its monetary forecast.
Lower oil prices helped reduce energy-related stocks.
In Asia
Tokyo’s Nikkei rose 0.42%, on track to end the week with its best weekly performance in nearly four months, thanks to gains in stock and shipping growth.
In China, the COVID-19 crisis and risks related to the real estate sector are raising concerns about growth prospects: the CSI300 lost 0.13% while the Shanghai Composite lost 0.22%.
the changes
Sur le marché des changes, l’euro repart à la baisse après que la présidente de la BCE, Christine Lagarde, a déclaré que si l’institution monétaire évoluait plus rapidement que ce qui avait été signalé précédemit final, pa elle un ne visa higher up.
Nor did the central bank provide many details about a new anti-fragmentation tool, just as Italian bonds are feeling the effects of the government’s collapse.
“The details, conditions, and justification for activating (this tool) were vague and unreliable in light of the Italian political situation,” Tapas Strickland, an economist at the National Australia Bank wrote.
The euro is hovering around $1.0188 after hitting 1.0278 on Thursday, its highest level in two weeks.
The dollar is stable against a standard basket.
modified
In the government bond market, the 10-year Treasury yield was little changed at 2.9005% after falling by about 13 basis points on Thursday under the influence of worse-than-expected US indicators and an interest rate hike from the European Central Bank.
The number of weekly jobless claims rose for the third week in a row, reaching an eight-month high of 251,000, and the “Philly Fed” index of activity in the Northeast US contracted to its lowest level since May 2020.
oil
In the oil market, Brent crude rose 1.21% to $ 105.12 a barrel and US Light crude (West Texas Intermediate) 1.05% to $ 97.36.
(Edited by Matthew Brottard)
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