The graph of the German DAX index at the Frankfurt stock exchange
by Claude Chendjou
PARIS (Reuters) – The main European stock markets are expected on a cautious note at the opening on Tuesday, the rebound recorded the day before being likely to be slowed down by the imminence of the publication of the first major macroeconomic indicators expected this week.
According to the first indications available, the Parisian CAC 40 should gain 0.49% at the opening. The Dax in Frankfurt could advance by 0.30%. The FTSE 100 in London, closed since Friday, should start the week with a gain of 1.04%, thus catching up with the gains recorded the day before by the other European places. The EuroStoxx 50 index is expected to rise by 0.30%.
European markets, which benefited Monday from the announcement of some economic support measures in China, should once again be focused on the monetary policy of the major central banks.
“Financial markets are only a reflection of the underlying economy, and we need policies that can address fundamental economic issues… From our perspective, the next two to three weeks is still a important window for policy decisions,” the Bank of America analysts wrote, downplaying the announcements from China.
During the opening Friday of the annual symposium in Jackson Hole (Wyoming), Jerome Powell, the chairman of the Fed pointed out that the American central bank could have to raise its interest rates further to return to inflation at 2%. Christine Lagarde, President of the European Central Bank (ECB), and Ben Broadbent, Deputy Governor of the Bank of England (BoE), also noted that the cost of credit could remain high for longer than expected. ECB Vice President Luis de Guindos and other Fed officials are yet to speak this week.
Investors are hoping that the data expected this week from China, Europe and the United States, including inflation, employment and the PMI/ISM indices, will provide indications on the evolution of the economic situation and the path of interest rates.
In this regard, the “Jolts” survey (Job Openings and Labor Turnover Survey) on job offers in the United States, whose publication is scheduled for Tuesday at 2:00 p.m. GMT, will constitute a first test.
While waiting for the monthly consumer confidence indices in the United States and France, the GfK index in Germany shows that consumer sentiment should deteriorate in September to -25.5 after -24.6 in August.
VALUES TO FOLLOW IN EUROPE:
AT WALL STREET
The New York Stock Exchange ended up on Monday, thanks in particular to gains recorded by 3M and Goldman Sachs.
The Dow Jones index gained 0.62% to 34,559.98 points.
The broader S&P-500 gained 0.63% to 4,433.31 points.
The Nasdaq Composite advanced for its part by 0.84% to 13,705.13 points.
Eight of the eleven major sectors of the S&P-500 rose, led by real estate and communication services.
Several high-growth stocks advanced, such as Nvidia, up 1.78%, and Apple and Alphabet which gained 0.9%. 3M jumped 5.2% after agreeing to pay more than $5.5 billion to settle some 300,000 lawsuits that the conglomerate sold combat earplugs to the US military defective. Goldman Sachs rose 1.8% on the back of a deal with management firm Creative Planning LLC to sell it an investment advisory unit.
IN ASIA
On the Tokyo Stock Exchange, the Nikkei index rose 0.18% to 32,226.97 points and the broader Topix gained 0.16% to 2,303.41 points at the close.
The MSCI index grouping stocks from Asia and the Pacific (excluding Japan) rose by 1%
In China, the Shanghai SSE Composite gained 1.29% and the CSI 300 gained 1.11%.
CHANGES
The dollar is stable (+0.03%) against a basket of reference currencies before the publication of the first indicators expected this week. The greenback is up 2% since the start of the month and has posted a six-week streak of gains.
The euro is trading at $1.0815 (-0.02%).
RATE
Yields on ten-year and two-year US Treasuries fell three points and two basis points, respectively, to 4.1824% and 4.9938%, as markets priced in with an 80% probability a steady quo on Fed rates in September, while the probability of a hike in November is estimated at 56%.
The German Bund yields for these two maturities are respectively 2.537% (-2.6 points) and 3.037% (stable).
OIL
The oil market is generally stable despite fears about demand linked to a possible continuation of monetary tightening in the United States: Brent lost 0.14% to 84.30 dollars a barrel and American light crude (West Texas Intermediate, WTI ) 0.21% to $79.93.
(Written by Claude Chendjou, edited by Kate Entringer)