Red is expected on Wall Street, results and central banks are visible
By Claude Chenjou
PARIS (Reuters) – Wall Street was expected to fall on Monday, with European stock markets also down mid-session amid caution at the start of a week marked by decisions from the three major central banks and the release of inflation and inflation indicators. employment as well as a new set of company results.
New York index futures on Wall Street pointed to a 0.63% drop for the Dow Jones, a 0.84% drop for the Standard & Poor’s 500 and a 1.15% drop for the Nasdaq. In Paris, the CAC 40 was down 0.48% at 7,063.15 around 12:50 GMT. In Frankfurt, the Dax is giving up 0.51%. In London, the FTSE stands out with a slight increase of 0.06%.
The pan-European FTSEurofirst 300 index fell by 0.46%, the euro zone EuroStoxx 50 index fell by 0.85% and the Stoxx 600 index fell by 0.49%.
The US Federal Reserve (FED) begins its two-day monetary policy meeting on Tuesday, which is expected to end with a capped 25 basis point increase in lending rates. The European Central Bank (ECB) and the Bank of England (BoE) will announce their decisions on Thursday and are expected to raise interest rates by 50 basis points, as in their previous meetings.
In addition to the immediate rise in credit prices, investors are particularly hopeful that central bankers will provide new indications on the future path of interest rates and their impact on the economy. On a related note, monthly euro zone consumer price figures will be released on Tuesday and the US employment report for January will be released on Friday.
“There is nervousness ahead of the crucial Fed meeting this week,” said Susannah Streeter, market analyst at Hargreaves Lansdown.
Key tech groups Apple, Amazon, Alphabet and Meta Platforms, which are sensitive to changes in interest rates, are also due to report their results this week.
Meanwhile, at the macroeconomic level, the German economy shrank by an unexpected 0.2% in the fourth quarter of 2022 compared to the previous three months. Economy in the first quarter of 2023.
Inflation in Spain rose again in January at an annual rate of 5.8% for the year, after 5.7% in December, according to the first estimate published by INE on Monday.
VALUES IN EUROPE
While waiting for the opening of Wall Street in Europe, the trend is driven by company news. Renault fell 3.14% after the French carmaker announced it was reducing its stake in Nissan from 43% to 15% as part of a rebalancing and restructuring of its alliances. The diamond firm’s name has gained about 25% since the talks between the two groups were announced in October.
Ryanair fell 2.26% as the airline announced a modest dividend payout from spring 2024, beating record profits in the October-December period.
Philips sent its share price down 70% after the Dutch group announced plans to cut 6,000 jobs to boost profitability following a recall of ventilators.
Unilever advanced 0.78% following the announcement that Hein Schumacher will replace Alan Cope as CEO from July 1.
RATES European bond yields rise on fears of renewed inflationary pressures after data from Spain. The ten-year German Bund, the benchmark for the entire eurozone, is up almost six basis points to 2.30%.
The yield on Treasury bonds with the same maturity in the United States rose three points to 3.54%.
On the foreign exchange market, the euro gained 0.3% to $1.09, benefiting from Spanish inflation figures.
The US currency, meanwhile, is almost flat against a basket of currencies (-0.1%) after hitting an eight-month high last week.
Oil prices are little changed with central bank meetings expected starting on Tuesday and OPEC+ meetings scheduled for Wednesday.
Brent fell 0.07% to $86.6 a barrel, US light oil (West Texas Intermediate, WTI) fell 0.25% to $79.48.
(Writing by Claude Chendjou, Editing by Kate Entringer)