Europe stock market should rebound at the opening – 11/01/2022 at 07:45


EUROPEAN SCHOLARSHIPS EXPECTED TO INCREASE

by Laetitia Volga

PARIS (Reuters) – The main European stock markets are expected to rise Tuesday at the opening after the modest advance of the Nasdaq the day before on Wall Street pending the hearing of Jerome Powell, the chairman of the Federal Reserve, in the Senate and the figures inflation in the United States expected Wednesday.

Futures contracts report an opening up 0.46% for the CAC 40 in Paris, 0.34% for the Dax in Frankfurt, 0.31% for the FTSE in London and 0.38% for the ‘EuroStoxx 50.

On Monday, European markets again ended in the red due to uncertainties related to inflation and the expected monetary tightening in the United States in particular, which pushed government bond yields up.

These considerations should continue as the publication of the US consumer price index looms on Wednesday, expected to rise 7% year-on-year in December by the Reuters consensus. A further acceleration in prices, following monthly employment data on Friday, could argue for an acceleration in the Federal Reserve’s monetary policy tightening.

Some of the biggest banks including Goldman Sachs and JP Morgan now expect four rate hikes this year in the United States starting in March.

While no major indicator is expected this Tuesday, investors will follow with interest the hearing of Fed Chairman Jerome Powell before the Senate Banking Committee with a view to his four-year renewal as head of the institution.

In the statement written for his hearing, Jerome Powell expressed his commitment to preventing higher inflation from setting in without explicitly mentioning the Fed’s rate hike plans.

“He will likely be faced with many questions about the timing and number of possible rate hikes as the US economy continues to recover,” said Michael Hewson, analyst at CMC Markets.

Governor Lael Brainard will be heard on Thursday for the post of vice-president of the Fed, succeeding Richard Clarida who will resign on Friday, two weeks earlier than expected, after controversies over her investments in the markets.

VALUES TO FOLLOW:

A WALL STREET

The New York Stock Exchange ended in disarray on Monday: the Dow Jones index fell 0.45% to 36,068.87 points and the S & P-500 lost 0.14% to 4,670.29 points, finishing far from their higher low of the day while the Nasdaq Composite gleaned 0.05% to 14,942.83 points after losing up to 2.7% in the session.

While investors spent the early part of the session worrying about rising bond yields and what expected inflation data might mean for US monetary policy, others took the opportunity to operate. cheap redemptions.

Futures are currently showing an open with little change.

IN ASIA

The Nikkei index in Tokyo fell 0.9% as investors were cautious about the possibility of a Fed rate hike as early as March.

Stock markets in China are also in negative territory: the CSI300 index is down 0.74% and the Shanghai composite index 0.51%.

RATE

The yield on the ten-year US Treasury bill, which hit a nearly two-year peak Monday at 1.808%, fell in trade in Asia to 1.7604%.

Its German equivalent could follow the same trajectory when the European market opens, after climbing to -0.025% the day before, a peak since May 2019.

CHANGES

In the currency market, the dollar fell 0.16% against a basket of benchmark currencies including the euro, which rose to $ 1.134.,

OIL

Oil prices are up after two days of decline: the barrel of Brent gained 0.58% to 81.34 dollars and US light crude 0.75% to 78.82 dollars.

(edited by Blandine Hénault)



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