PARIS (Reuters) – European markets ended lower on Tuesday, with numerous events worrying investors, whether the French legislative elections or the latest declarations relating to monetary policy.
In Paris, the CAC 40 lost 0.58% to 7,662.3 points, while the German Dax fell by 0.89% and the British Footsie by 0.41%.
The EuroStoxx 50 index ended the session down 0.41%, compared to 0.27% for the FTSEurofirst 300 and 0.29% for the Stoxx 600.
In France, the legislative elections remain the main subject of concern for the markets, while the decision to dissolve the National Assembly triggered a sharp correction in French assets and a political risk premium persists.
Furthermore, the stock market fall of Airbus and Merck on Tuesday weighed on the European indices, of which they are important constituents.
Investors are also preparing for the publication of a series of data on price dynamics, which will begin on Friday with the publication of PCE inflation in the United States and French inflation.
Inflation in the euro zone will be published at the start of next week.
These figures will be essential to gauge the trajectory of monetary policy: in the United States, restrictive declarations from Federal Reserve officials follow one another, the central bank continuing to postpone the date of its first rate cut.
In the euro zone, doubt also persists over the next decisions of the European Central Bank, while the latest activity figures surprised on the downside.
The fall of Nvidia at the end of last week, which seems to be reversed on Tuesday, also fuels risk aversion, the title backed by the theme of artificial intelligence having been one of the main contributors to stock performance American in 2024.
A WALL STREET
Wall Street is hesitant at mid-session, because while the Nasdaq is benefiting from Nvidia’s rebound, political and monetary uncertainties are weighing on the indices.
At closing time in Europe, trading on the New York Stock Exchange indicated a drop of 0.68% for the Dow Jones, against an increase of 0.3% for the Standard & Poor’s 500, and 1.08 % for the Nasdaq Composite.
VALUES
Airbus on Monday lowered its total target for aircraft deliveries in 2024 and announced the entry in its accounts of a charge of 900 million euros in the first half, which caused the stock to fall by 9.52%, among the worst performances of the Stoxx 600.
Safran dropped 3.37% in the wake of Airbus, while engine makers Rolls-Royce and MTU Aero Engines declined 1.34% and 3.28% respectively.
Eurofins on Tuesday denied allegations of financial embezzlement made by the hedge fund Muddy Waters against it, and rose 4.18%, one of the best performances on the Stoxx 600.
Trigano reported a 10.8% rise in third-quarter revenue on Monday, citing strong growth in its motorhome sales, but fell 5.83%.
Richemont rose 3.02% after Bloomberg reported that LVMH CEO Bernard Arnault had personally taken a stake in the Swiss luxury group.
Merck KGaA fell 5.9%, the German laboratory having announced the day before that a clinical trial relating to a drug against head and neck cancer, considered until now to be promising, would be interrupted due to a lack of efficiency.
Novo Nordisk rose 4.01% after announcing that its weight loss drug Wegovy had been approved in China.
RATE
Yields in Europe fell moderately as investors sought safe assets to offset political uncertainty.
The yield on the German ten-year fell by 1 bps to 2.412%, while that of the two-year rate remained stable at 2.81%.
At the close of the European interest rate markets, the ten-year Treasury yield was unchanged at 4.2554%, compared to an increase of 1.9 bp for the two-year rate, at 4.753%.
CHANGES
The dollar is strengthening strongly, in a context of risk aversion and after restrictive monetary policy comments in the United States.
The dollar gained 0.21% against a basket of reference currencies, while the euro lost 0.21% to 1.0709 dollars. The pound sterling is stable at $1.2678.
OIL
Crude is falling under pressure from the dollar, but the decline remains limited as markets bet on more robust demand than expected this year.
Brent declined by 0.27% to $85.78 per barrel, American light crude (West Texas Intermediate, WTI) decreased by 0.13% to $81.52.
(Written by Corentin Chappron)
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