by Claude Chendjou
PARIS (Reuters) – The main European stock markets are expected to fall on Wednesday for the third consecutive session in a context of risk aversion linked to questions about interest rates and the economic situation while a myriad of indicators must be published during the day.
According to the first available indications, the Parisian CAC 40 should lose 0.21% at the opening, the Dax in Frankfurt 0.22% and the FTSE 100 in London 0.13%. The EuroStoxx 50 index is expected to decline by 0.12%.
The markets, at half mast since the start of the fourth quarter, were affected on Tuesday by the prospect of an extension of monetary tightening by the American Federal Reserve (Fed) given the unexpected rebound in job offers (Jolts survey) in August in the United States. They should undergo a new test this Wednesday with the publication of the monthly indices of services activity, the main figures of which in Europe will be known from 07:50 GMT, while in the United States, the ISM of services is planned at 2:00 p.m. GMT.
In addition to these data, investors are also awaiting monthly statistics on retail sales and producer prices in the euro zone, which could provide indications on the economic situation and the evolution of inflation in the bloc.
In this regard, the speech by Christine Lagarde, the president of the ECB, during a conference on monetary policy, should be particularly followed.
In the United States, while waiting for the official monthly employment report, scheduled for Friday, the ADP survey, published this Wednesday at 12:15 p.m. GMT, could once again demonstrate resistance in the labor market despite the Fed’s attempts to curb demand in order to bring down inflation.
A WALL STREET
The New York Stock Exchange ended sharply lower on Tuesday as economic data released during the day reinforced the hypothesis that the Fed may have to maintain its high rates for a long period.
The Dow Jones index fell 1.29%, or 430.97 points, to 33,002.38 points.
The broader S&P-500 lost 58.94 points, or 1.37%, to 4,229.45 points.
The Nasdaq Composite fell 248.31 points (1.87%) to 13,059.47 points.
This is the lowest closing level for the S&P-500 since June 1, while the Dow Jones fell into the red over the year for the first time since June.
The CBOE volatility index, considered an indicator of the level of fear on Wall Street, has been at a peak since May 24.
All the main sectors of the S&P-500, apart from utilities, ended the session in the red, notably technologies while high-growth stocks are among the most affected by the rise in bond yields.
IN ASIA
On the Tokyo Stock Exchange, the Nikkei index fell 1.76% to 30,689.07 points, hitting a low of more than four months, in the wake of Wall Street. The broader Topix fell 1.88% to 2,232.67 points as the close approached.
The MSCI index bringing together stocks from Asia and the Pacific (excluding Japan) fell for the second consecutive session, falling by more than 1%.
Markets in mainland China are still closed this Wednesday, a week of annual holidays having started after Friday’s session.
VALUES TO FOLLOW IN EUROPE:
CHANGES
The dollar continues its progression, gaining 0.06% against a basket of reference currencies to reach a peak of almost 11 months.
The Japanese currency briefly crossed the threshold of 150 yen to the dollar before suddenly falling to 147.30, fueling speculation of intervention by the Japanese authorities. The yen is now trading at 149.21.
The euro remains stuck at its lowest level since December, standing at 1.0471 dollars (+0.06%).
The New Zealand dollar fell 0.11%, to 0.59015 US dollars, after the decision of the New Zealand Central Bank (RBNZ) to leave its main key rate unchanged at 5.5%.
RATE
The yield on ten-year US Treasury bonds, which rose around ten basis points on Tuesday, rose again on Wednesday, by more than three points, to 4.8377%, the highest since 2007.
The yield on ten-year JGBs, Japanese government bonds, is around 0.78%, the highest since September 2013, despite an intervention by the Bank of Japan (BoJ) which carried out a buyback on Wednesday. emergency bonds.
OIL
Oil prices are almost in balance before the OPEC+ ministerial meeting, with the market divided between the prospect of a tightening of crude supply and fears about interest rates.
Brent fell 0.16% to $90.77 per barrel and American light crude (West Texas Intermediate, WTI) fell 0.17% to $89.08.
(Written by Claude Chendjou, edited by Bertrand Boucey)
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