EUROPE ENDS UP AFTER GOOD RESULTS, TAIWAN LESS WORRIES
(Reuters) – European stocks ended higher on Wednesday as a series of encouraging corporate earnings results somewhat offset fears about the strength of the region’s economy.
In Paris, the CAC 40 ended up 0.97% at 6,472.06 points. The British Footsie gained 0.49% and the German Dax 1.03%.
The EuroStoxx 50 index gained 1.31%, the FTSEurofirst 300 0.4% and the Stoxx 600 0.5%.
Investors also seem rather relieved after US House Speaker Nancy Pelosi’s visit to Taiwan ended, which did not result in a major escalation with China at this stage.
“Pelosi’s trip has come to an end, which traders have taken as a sign that US-China relations are at least better than 48 hours ago, so as far as markets go, it there won’t be any major repercussions,” said David Madden, market analyst at Equiti Capital.
The morning’s macro-economic disappointments – notably the July contraction in eurozone business activity – and the statements of several Fed representatives on inflation do not seem to erase this relative relief from observers for the moment. .
VALUES
The technology sector gained 3.21%. Avast jumped 43.75% on the London Stock Exchange after the British competition and markets authority granted provisional authorization for the takeover of the cybersecurity company by its competitor NortonLifeLock for 8.6 billion dollars.
BMW lost 5.56% after reporting results and saying total deliveries will fall short of the 2021 record of 2.52 million across the group.
Axa finished at the top of the CAC 40 (+5.65%) after publishing a net profit up 3% in the first half, while Societe Generale gained 3% after posting a lower loss than expected.
AT WALL STREET
At the close in Europe, the Dow Jones gained 0.95%, the Standard & Poor’s 500 gained 1.20% and the Nasdaq rose 2.16%.
Moderna climbed 15.89% after the vaccine maker announced a $3 billion share buyback plan, while Regeneron Pharmaceuticals gained 7.89% after beating quarterly revenue estimates.
For its part, Advanced Micro Devices dropped 2.66% after the announcement by the electronic chip designer of a sales forecast for the third quarter slightly lower than analysts’ estimates.
THE INDICATORS OF THE DAY
In Germany, German exports rose more than expected in June, by 4.5% over one month, and activity in the German services sector fell into contraction in July after six months of growth.
In the UK, activity in the UK services sector grew in July at its slowest pace since the start of 2021 although price pressures have eased.
In Europe, Eurozone business activity contracted slightly in July for the first time since early 2021. In addition, Eurozone retail sales fell more than expected in June to -1.2% over one month and 3.7% over one year, while industrial producer prices continued to rise.
In the United States, the ISM services index rose to 56.7 from 55.3 the previous month, an unexpected increase for economists polled by Reuters who expected an average slowdown to 53.5.
CHANGES
On the currency market, the dollar is up 0.39% against a basket of benchmark currencies. The euro is trading around 1.0143 dollars, down 0.21%, after the contraction of the PMI indices and the drop in retail sales in the euro zone.
RATE
Yields on benchmark government bonds are rising as investors brace for further big Fed rate hikes to rein in inflation after determined comments from Fed officials.
That of the ten-year American gained nearly four basis points to 2.7738% and its German equivalent took more than eight points to 0.8640%.
(Written by Olivier Cherfan, edited by Jean-Michel Bélot)