EUROPEAN SCHOLARSHIPS END ON THE RISE
by Claude Chendjou
PARIS (Reuters) – European stock markets ended the first session of 2022 higher on Monday, while Wall Street is also moving in the green mid-term, with equity markets buoyed by hopes that the surge in cases of contaminations will not hinder the global economic recovery.
In Paris, the CAC 40 ended with a gain of 0.9% to 7,217.22 points. The German Dax gained 0.86%.
The EuroStoxx 50 index advanced 0.78%, the FTSEurofirst 300 0.54% and the Stoxx 600 0.45%.
The London Stock Exchange remained closed to extend the New Years weekend.
The Stoxx 600, which gained 22.5% over the whole of 2021, its third consecutive year of increase, and the CAC 40, which rose 28.9%, its best annual performance since 1999, continue to benefit from the ebb concerns about the Omicron variant of the coronavirus. Recent studies, based on data from South Africa and the UK, suggest that Omicron is less severe than its predecessors.
“There is a certain optimism that we are witnessing at the start of the year with the general feeling that the Omicron variant will not do as much damage to the economy as initially imagined,” notes Rick Meckler, partner at Cherry Lane Investments.
In Europe, the equity markets are also supported by the final results of the Markit surveys of purchasing managers in the manufacturing sector released on Monday. Growth in manufacturing activity in the euro area remained strong in the last weeks of 2021 with an index at 58.0 after 58.4 in November.
VALUES IN EUROPE
In Paris, the CAC 40 was pulled among others by the luxury segment: L’Oréal and LVMH gained 2.17% and 0.55% respectively. Michelin (+ 1.73%), for its part, benefited from the raising of Oddo’s price target on the tire manufacturer.
Renault and Stellantis, the best performance of the Paris index, advanced 2.84% and 3.81% respectively in the wake of the increase in the automotive compartment (+ 2.45%), the strongest sector growth of the Stoxx 600.
In air transport, Air France-KLM (+ 4.88%) and Lufthansa (+ 8.87%) benefited from the increase in Citigroup recommendations on several stocks in the sector, the American bank counting on an outperformance of flight specialists long-haul.
Airbus (+ 3.36%), for its part, was driven by its deliveries, the European aircraft manufacturer having exceeded its target of 600 aircraft deliveries in 2021, according to a count that still needs to be consolidated, said Monday to Reuters from industry sources.
On the downside, Iveco had a complicated stock market debut in Milan with a decline of more than 10% on its first day of listing as an independent company after its split from CNH Industrial.
Dutch semiconductor equipment maker ASML Holding ended up down 0.71% after reporting a fire at its Berlin plant as the industry needs to ramp up production.
A WALL STREET
At the time of the close in Europe, the Dow Jones and Standard & Poor’s 500 are virtually stable, while the Nasdaq is up 0.61%, with indices close to their record highs.
Among values, Tesla jumped 10.2% on Sunday’s announcement of record vehicle deliveries, to 308,600 units for the last three months of 2021. Its competitors Lucid Group and Nio each take around 4%.
Oil giants Chevron (+ 1.52%) and Exxon Mobil (+ 3.16%) are for their part supported by the prospect of a rebound in global demand for crude in 2022.
CHANGES
At forex, the dollar is also on a good trend for its debut in 2022, with the note gaining 0.32% against other major currencies in anticipation of a US Federal Reserve rate hike this year.
The euro fell 0.71% to $ 1.1289 after hitting a six-week high at 1.1386 on Friday.
RATE
In the bond market, yields on government bonds are rising, with that on ten-year US Treasuries trading at 1.6106%.
Its German equivalent with the same maturity ended with a gain of 5.5 basis points to -0.124%, while the French 10-year rate gained 4.2 points to 0.2360%.
OIL
The oil market is moving up sharply after the announcement of a temporary decrease in Libya’s supply of 200,000 barrels per day (bpd) for a week due to maintenance work on an oil pipeline.
According to three sources close to oil-producing countries, OPEC and its allies are also expected to stick Tuesday to their quota to increase production of 400,000 barrels per day (bpd) for February, betting on a limited impact of ‘Omicron on demand.
The barrel of Brent gained 1.17% to 78.69 dollars a barrel and that of American light crude (West Texas Intermediate, WTI) 0.93% to 75.9 dollars.
(Report Claude Chendjou, edited by Jean-Michel Bélot)