By Claude Chenjou
PARIS (Reuters) – Major European stock markets are expected to open lower on Thursday amid a sharp deterioration in U.S. indicators, particularly retail sales, after Wall Street closed a day earlier. It revived concerns about a hard landing for the US economy.
According to the first indicators available, Frankfurt’s Dax should lose 0.54%, London’s FTSE 100 should lose 0.51% and the EuroStoxx 50 index should lose 0.6%.
The session may again be dominated by central banks. A monetary policy decision is expected from the Bank of Norway when European Central Bank (ECB) President Christine Lagarde speaks at the World Economic Forum in Davos at 10:30 GMT.
On Thursday, back-to-back statements by James Bullard and Loretta Mester, two officials of the American Federal Reserve System (FED), on the need to raise interest rates in the United States above 5%, dampened investors’ enthusiasm for a slowdown in prices. credit.
The statements overshadowed a decline in US producer prices in December and fueled concerns about the evolution of economic conditions across the Atlantic as retail sales in the country contracted more sharply than expected. , increased the likelihood of recession. Especially since US industrial production fell more markedly than expected last month.
“Falling retail sales and industrial production add to the theme of the economy slowing and heading into recession in 2023. This pushes back the soft bearish scenario that has dominated markets since January,” National Australia Bank chief economist Tapas Strickland said.
Meanwhile, corporate finance publications continue with mixed success, particularly in the banking sector. In this regard, the expected consequences of Netflix’s shutdown will be a test for the new technologies sector. Earlier, consumer staples giant Procter & Gamble will report its fourth-quarter results.
ON WALL STREET
The New York Stock Exchange fell on Wednesday after the release of weak economic data and comments by Fed officials in favor of further interest rate hikes.
The Dow Jones index fell by 1.81% or 613.89 points to 33,296.96 points.
The broader S&P-500 lost 62.11 points, or 1.56%, to 3,928.86.
The Nasdaq Composite fell by 138.1 points (-1.24%) to 10,957.01 points.
Microsoft also announced 10,000 job cuts to deal with dematerialized computing (the “cloud”) and its customers’ spending cuts in an uncertain economic context.
On the Tokyo Stock Exchange, the Nikkei index fell 1.44% to 26,405.23 points, while the broader Topix fell 1% to 1,915.62 points.
In China, the SSE Composite of Shanghai gained 0.22%, and the CSI 300 gained 0.26%.
In foreign currency, the dollar is almost stable compared to the basket of international currencies (-0.09%).
The Japanese currency rose to 127.88 yen against the dollar as traders speculated that it would correct in March or April, following an unexpected decision by the Bank of Japan (BoJ) a day before. the status quo.
The New Zealand dollar fell 0.43% to $0.6417 after the surprise announcement of New Zealand Prime Minister Jacinda Ardern’s resignation.
The euro is trading at $1.0795 (+0.03%).
The yield on ten-year U.S. Treasury bills fell nearly five basis points to 3.32%, the lowest since September.
The German Bund with the same maturity fell eight points to close at 2.00% on Wednesday.
Oil prices fell again amid renewed recession concerns: Brent fell 1.05% to $84.09 a barrel, while U.S. West Texas Intermediate (WTI) fell 1.33% to $78.42.
(Writing by Claude Chendjou, Editing by Kate Entringer)