A trader in London, Great Britain
by Augustin Turpin
(Reuters) – European stock markets ended mixed on Wednesday on a cautious note, the negative trend being fueled by the luxury sector after the LVMH results, while Wall Street was hesitant at mid-session before the publication of the report of the last monetary policy meeting of the American Federal Reserve (Fed) and the inflation figures in the United States.
In Paris, the CAC 40, rich in luxury values, ended down 0.44% at 7,131.21 points, penalized in particular by a 6.46% fall in LVMH, the bottom of the index. The British Footsie lost 0.11%. The German Dax, supported by industrial and defense stocks, gained 0.24%.
The EuroStoxx 50 index fell by 0.11%, while the FTSEurofirst 300 advanced by 0.18% and the Stoxx 600 by 0.15%.
The fall in bond yields, which dragged the stock markets for a large part of the session, gave way at the time of the closing in Europe to more caution as the publication at 6:00 p.m. GMT of the “minutes” of the Fed meeting on September 19 and 20.
The main statistic of the day, which showed a stronger than expected increase in producer prices (PPI) in the United States in September, also did not inspire optimism before Thursday’s release of consumer prices ( ICC).
The Fed “minutes” and the CPI could provide investors with information on the evolution of the situation and the trajectory of future rates while the market continues to count on a status quo on federal funds rates at meetings of November and December of the American central bank.
According to Edward Moya, analyst at Oanda, investors continue to believe that the process of disinflation is now underway despite the data published this Wednesday, which explains the decline in bond yields.
VALUES
In the wake of LVMH which reported sales in the third quarter below expectations, Kering and Hermès lost 1.41% and 1.49% in Paris respectively, while Burberry in London lost 3.18% and Richemont lost 3.18%. Zurich 4.04%.
French software company Planisware, which was due to take its first steps on the stock market on Thursday, postponed its IPO on Wednesday, citing difficult market conditions.
A WALL STREET
At the close in Europe, the Dow Jones fell by 0.21% and the Standard & Poor’s 500 by 0.13%, while the Nasdaq gained 0.18%.
Exxonmobil dropped 4.97% after announcing the acquisition of its American competitor Pioneer Natural Resources (+0.45%) for around $60 billion.
Birkenstock Holding is making its stock market debut in New York this Wednesday as part of an IPO that values the German shoe maker at around $9.3 billion.
TODAY’S INDICATORS
German inflation, calculated according to European standards, decelerated in September to 4.3% year-on-year, according to final data from the Federal Statistical Office.
CHANGES
The dollar is stable (+0.02%) against a basket of reference currencies after monthly data on producer prices in the United States. The greenback, however, hit a two-week low during the session, at 105.55 points.
The euro is also almost unchanged (-0.01%), at 1.0602 dollars after reaching a session high since September 25, at 1.0634 dollars.
RATE
Bond yields in the euro zone continued to fall on Wednesday after recent comments deemed accommodating made by several Fed officials.
The yield on ten-year American Treasuries fell by 7.4 basis points, to 4.587%, while its German equivalent of the same maturity ended down by 6.5 points, to 2.722%.
OIL
Fears of a disruption in supplies in the context of the conflict between Palestinian Hamas and Israel are taking precedence over the commitment of Saudi Arabia, OPEC’s main producer, to stabilize the market.
Brent dropped 1.30% to $86.51 per barrel and American light crude (West Texas Intermediate, WTI) fell 1.88% to $84.35 CLc1.
TO BE CONTINUED THURSDAY:
(Written by Augustin Turpin, edited by Claude Chendjou)