The Euronext Stock Exchange
by CORENTIN CHAPRON
(Reuters) – The main European stock markets are expected on a hesitant note on Monday before several central bank meetings this week, including the Federal Reserve and the Bank of Japan.
The first available indications indicate that the Parisian CAC 40 would decline by 0.10% at the opening. Futures on the FTSE in London suggest a decline of 0.27%, with the Dax in Frankfurt and the EuroStoxx 50 expected to be flat.
The agenda is busy for the markets, since the Federal Reserve, the Bank of Japan, the Bank of England, but also the Swiss, Norwegian and Swedish central banks, will meet this week to decide on the trajectory of their respective monetary policies .
Investors’ attention will primarily focus on the Fed, which could decide on Wednesday to maintain its rates at their current level, depending on market expectations.
The central bank’s view of the trajectory of prices and activity will be essential to gauge the evolution of American monetary policy, as the labor market begins to slow and inflation remains persistent.
“Mixed American data and comments from members of the Fed support market expectations, which are counting on a new pause at the meeting on September 20,” estimate ING strategists.
“However, concerns about inflation remain and the resilience of the economy suggests that the Fed will continue to signal the possibility of a final hike, although we do not believe it will follow through on its threats.”
Furthermore, Eurozone inflation is expected on Tuesday, while British inflation will be released on Wednesday and preliminary PMI indicators for September will be revealed on Friday.
A WALL STREET
The New York Stock Exchange ended lower on Friday as concerns over weak demand weighed on semiconductor manufacturers, while growth stocks were affected by rising Treasury yields.
The Dow Jones index fell 0.83%, or 288.87 points, to 34,618.24 points. The broader S&P-500 lost 54.78 points, or 1.22%, to 4,450.32 points. The Nasdaq Composite fell 217.72 points (-1.56%) to 13,708.34 points.
IN ASIA
Japanese markets are closed on Respect for the Elderly Day, a public holiday.
Chinese stocks are hesitant, pushed down by the real estate sector which is declining after employees of Evergrande’s wealth management division were arrested. The Shanghai SSE Composite is stable, the CSI 300 gains 0.39%, and the Hong Kong Hang Seng index loses 1%.
CHANGES
Foreign exchange markets are calm ahead of a busy week, as four of the central banks meeting this week oversee one of the ten most traded currencies.
The dollar fell 0.08% against a basket of reference currencies, the euro gaining 0.13% to 1.0669 dollars, while the pound sterling advanced 0.08% to 1.2399 dollars.
In Asia, the yen gained 0.12% to 147.65 yen per dollar, while the Australian dollar gained 0.23% to 0.6447 dollars.
RATE
American rates are stable in a wait-and-see environment.
The ten-year Treasury yield is static at 4.3224%, while the two-year rate is standing still at 5.0347%.
OIL
Oil continues to rise after two sessions of gains, with optimism regarding a rebound in Chinese demand and production cuts in Saudi Arabia and Russia supporting prices.
Brent advanced 0.57% to $94.47 per barrel, with American light crude (West Texas Intermediate, WTI) gaining 0.73% to $91.43.
(Edited by Blandine Hénault)