(CercleFinance.com) – The Paris Stock Exchange is not demoralized by the 37.2% surge in producer prices in the Eurozone in April (long rates at their highest for 8 years), nor by the decline of Wall Street after disappointing ‘ADP’ figures.
The CAC gained 1% to 6,480 and even climbed into contact with 6,500 Pts, despite the -0.6% decline in the Dow Jones (Microsoft lost -2.6%) and -0.3% in the S&P500.
The London Stock Exchange is closed today and tomorrow due to the festivities organized on the occasion of the jubilee of the 70 years of reign of Elizabeth II.
Although all the general public channels are mobilized by the event, the economic news is nonetheless dense with numerous US statistics on the menu this afternoon… and the bond markets are feeling the pinch.
The ADP firm published its monthly survey of job creations in the non-agricultural private sector in the United States and recorded only 128,000 net hires in May, a number half the consensus, after the 202,000 job creations. April (revised from an initial estimate of +247,000).
In detail, the services sector created 104,000 jobs (including 46,000 in education and health), while the goods production sector generated 24,000 (including 22,000 in the manufacturing industry).
Operators discovered the revised figure for non-agricultural productivity in the first quarter of 2022: the decline would be 7.3% in the United States at an annualized rate, and not 7.5% at first reading a month ago.
What still deserves the term plunge reflects a 2.3% drop in production even though the number of hours worked increased by 5.4%. Combined with a 4.4% increase in hourly wages, it leads to a 12.6% rise in unit labor costs.
Weekly jobless claims fell again the week of May 23 in the United States (-11,000), the statistics amounting to 200,000 figures from the Department of Labor.
Finally, the Department of Commerce reported on Thursday a 0.3% increase in new orders for manufactured goods in April after a revised increase of 1.8% in March (the increase thus reached 12.5% on a year).
.Economists, however, expected a sharper increase in the statistics, around 0.7%.
The four-week moving average, which can be considered a better indicator of the labor market’s underlying trend, came out at 206,500, practically stable compared to the previous week (207,000, revised figure).
The return on T-Bonds, which had eased this morning, is back to its levels of the previous day (2.925%).
In Europe, industrial producer prices increased by +1.2% compared to March, but over 1 year, inflation rose to a vertiginous +37.2% and now peaks at levels not seen for more than 40 years.
Bond yields continue to tighten in Europe and break records since April/May 2014: our OATs post +6.5Pts to 1.7620%, Bunds +5Pts to 1.23%, Italian BTPs +10Pts to 3.285 %, annual record.
On the commodities market, oil prices continued their correction, US light crude stabilized at 114.9 dollars, and Brent from the North Sea rose 0.5% to 115.9$.
On the securities side, Rémy Cointreau (+3.8%) publishes for the 2021-22 financial year an EPS group share (excluding non-recurring items) up 52.8% to 4.52 euros. The spirits house achieved a turnover of 1.31 billion euros, up 27.3% on an organic basis.
Eurofins Scientific announces the conclusion of a partnership with the shareholders of Saudi Ajal, to finalize the acquisition of a majority stake in Ajal for Laboratories, a food, tobacco and pharmaceutical testing laboratory in Saudi Arabia.
Finally, Saint-Gobain (+4%) says it expects its operating income for the first half of 2022 to exceed the record level of the same period in 2021 and its operating margin to reach a level of two figures.
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