by Diana Mandia
(Reuters) – European stock markets ended higher on Thursday, welcoming the latest interest rate cut in Switzerland and comments from the Bank of England (BoE) on inflation, while the technology sector continued its jump. on both sides of the Atlantic.
In Paris, the CAC 40 gained 1.34% to 7,671.34 points. In Frankfurt, the Dax advanced 0.97% and in London, the FTSE 100 gained 0.86%.
The EuroStoxx 50 index ended with a gain of 1.27%, the FTSEurofirst 300 by 0.90% and the Stoxx 600 by 0.93%.
The Bank of England (BoE) kept its main policy rate unchanged on Thursday, but some officials said their decision not to cut rates was now “finely balanced”.
Although widely expected, the move allowed the London Stock Exchange to amplify its gains, and led to a decline in the pound and Gilt yields.
BoE Governor Andrew Bailey said the fall in inflation to 2% in May was “good news” as it meant a return to the institution’s target for the first time in nearly of three years, while specifying that prices must remain low before a rate reduction.
The BoE actually expects inflation to rise above target as the effect of past falls in energy prices fades from annual price data.
Markets now consider that there is a 45% chance that the BoE will cut rates in August, compared to 30% before Thursday’s decision.
“The overall message is that inflationary pressures are easing in the UK, a trend recognized by policymakers,” said Dean Turner, an analyst at UBS Global Wealth Management.
Elsewhere in Europe, the Swiss National Bank (SNB), as expected, lowered its rates on Thursday, causing the Swiss franc to fall and shares to rise on the Zurich Stock Exchange, which ended with a gain of 0.56%.
On the other hand, the Norwegian central bank kept its main interest rate unchanged on Thursday and said that a possible reduction in the cost of credit would not take place before 2025.
VALUES
The technology index (+1.63%) was led by semiconductor equipment maker ASMI, which climbed 5.3% after Morgan Stanley raised its recommendation from “overweight” to “weight weight”. line” and while in the United States, Nvidia stands out thanks to the rise of generative artificial intelligence technologies.
In Paris, Danone lost 2.5% after saying it expected annual growth in its turnover on a comparable basis of 3% to 5% between 2025 and 2028.
The manufacturer of stationery and lighters BIC, which has revised downwards its annual turnover growth forecasts, has dropped 12%, the bottom of the SBF 120 index.
A WALL STREET
At closing time in Europe, the Dow Jones rose by 0.22% and the Standard & Poor’s 500 by 0.03%, while the Nasdaq Composite fell by 0.09%.
Nvidia continues its rally and progresses by 1%, while Accenture, which exceeded expectations on Thursday on its turnover growth forecast, takes 7%.
TODAY’S INDICATORS
In the United States, unemployment claims decreased during the week ending June 10 to 238,000 compared to 243,000 the previous week.
Another indicator on the agenda, the construction of single-family homes, recorded a drop of 5.2% in the United States in May.
In the euro zone, producer prices fell at a greater rate than expected in May over one year, according to data published Thursday by the Federal Statistical Office.
CHANGES
On the foreign exchange market, the dollar advanced 0.30% against a basket of reference currencies, while the euro lost 0.28% to 1.0712 dollars.
The pound sterling fell 0.38% to $1.2667 after the BoE decision.
RATE
Bond yields rose in the euro zone on Thursday as investors received a series of decisions from central banks.
The yield on the ten-year German Bund increased by 2.2 basis points (bp) to 2.4260%, while that of the ten-year OAT was rather stable at 3.1539%, the lull being confirmed after the turbulence of last week due to the electoral meeting announced to everyone’s surprise in France.
In the United States, the yield on ten-year Treasuries increased by 6 bp to 4.2769%.
OIL
Oil prices hit their highest level in seven weeks on Thursday as macroeconomic news boosted hopes over Federal Reserve rate cuts and as fears of an escalation in the Middle East conflict continue to mount. support the courses.
Brent gained 0.6% to $85.57 per barrel, while American light crude (West Texas Intermediate, WTI) gained 0.6% to $82.10.
(Written by Diana Mandia, edited by Augustin Turpin)
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