by Claude Chendjou
PARIS (Reuters) – Wall Street is expected to rise on Monday and European stock markets, with the exception of London, are also moving in the green mid-session, driven by transport and leisure stocks which offset the decline in groups of luxury after the reaffirmation in China of the pursuit of the “zero COVID-19” strategy. Futures on New York indices signal an opening on Wall Street up 0.43% for the Dow Jones, 0.48% for the Standard & Poor’s 500 and 0.49% for the Nasdaq. The attention of investors across the Atlantic is focused on the American midterm elections, scheduled for Tuesday, which could tip at least one of the two houses of Congress into the hands of the Republicans, risking to weaken a little more a Joe Biden already weakened while fully reinstating Donald Trump for the next presidential election.
Apart from this election deadline, the rest of the week should be calm, the main economic indicator expected being the US inflation expected on Thursday. The Reuters consensus expects a slowdown to 8.0% over one year in October after 8.2% in September.
In Europe, with the exception of final inflation data from Germany and the first estimate of UK third-quarter GDP due on Friday, no major indicators are on the agenda for the week. In Paris, the CAC 40 advanced Monday by 0.33% to 6,437.6 around 1:10 p.m. GMT. In Frankfurt, the Dax takes 0.86%. In London, however, the FTSE fell by 0.16%.
The pan-European FTSEurofirst 300 index gained 0.46%, the EuroStoxx 50 in the euro zone 0.77%. The Stoxx 600, which recorded four weeks in the green, advanced 0.64%.
The positive trend at mid-session is mainly supported by the transport and leisure compartment, the index of which rose to 2.43%, the highest in three months and the best progression of the Stoxx 600.
European indices had started the session on a hesitant note after disappointing Chinese export and import figures for October and the authorities’ reaffirmation of strict control of the COVID-19 epidemic.
VALUES IN EUROPE The sector of transport and leisure is driven in particular by Ryanair, whose action jumped 6.02%, the company having published in the first half of the year the largest profit in its history.
Flutter Entertainment also contributed to the good performance of this compartment with a 3.92% increase in its share after a decision handed down by an arbitration court on its dispute with Fox Corp in the sports betting company FanDuel.
Hong Kong has also relaxed COVID-19 control measures for tourists traveling in groups.
Luxury stocks like LVMH and Hermès lost -0.61% and 0.11% respectively, due to their exposure to China.
In other compartments, Vinci lost 2.31%, a subsidiary of the group being summoned by the courts for construction sites in Qatar.
UniCredit yields 2.56%, the Financial Times having reported on Sunday a disagreement between the European Central Bank (ECB) and the group about its plan to distribute cash to shareholders and its presence in Russia.
WALL STREET VALUES TO FOLLOW [USN]
Apple fell 1% in pre-market trading, the American group having announced that it expects lower than expected deliveries for its iPhone 14 Pro due to health restrictions which are heavily affecting production at the mega-factory of its subcontractor Foxconn in Zhengzhou. , in China.
RATE
Bond yields vary little for lack of a catalyst and pending Thursday consumer price figures in the United States.
That of the ten-year German Bund lost less than two basis points to 2.273%, while its American equivalent of the same maturity lost around two points to 4.133%.
EXCHANGESThe dollar fell 0.29% against a basket of benchmark currencies, penalized by risk appetite and the good performance of equity markets in Europe.
The Sentix Institute’s monthly survey further showed that investor sentiment in the euro zone improved for the first time in three months in November, the current mild temperatures and lower energy prices seeming to dissipate the threat of gas rationing this winter.
The euro took 0.35% to 0.9995 dollars.
OIL
Oil prices are affected by news from China: Brent falls 0.78% to $97.8 a barrel and US light crude (West Texas Intermediate, WTI) 0.94% to 91.74 dollars per barrel.
NO MAJOR ECONOMIC INDICATOR ON THE NOVEMBER 7 AGENDA
(Written by Claude Chendjou, edited by Sophie Louet and Matthieu Protard)
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