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Market: Europe ends in the red after US employment


by Claude Chendjou

PARIS (Reuters) – European stock markets, with the exception of Frankfurt, ended lower on Friday and Wall Street also fell mid-session after the publication of the report on employment in the United States which highlights job creations. higher than expected, raising fears of another marked monetary tightening by the US Federal Reserve (Fed).

In Paris, the CAC 40 ended down 0.17% at 6,742.25 points. The British Footsie lost 0.03%. The German Dax, supported in particular by industrial stocks, gained 0.27%.

The EuroStoxx 50 index fell by 0.17%, the FTSEurofirst 300 by 0.14% and the Stoxx 600 by 0.15%.

Over the week as a whole, the CAC 40 recorded a gain of 0.44% and the Stoxx 600 an increase of 0.80%, thanks in particular to expectations of a lull in the rise in interest rates in view of the declarations Wednesday of Jerome Powell, the president of the Fed.

Figures released Friday by the US Department of Labor, however, dealt a blow to the renewed optimism in the markets as the US economy created 263,000 non-farm payrolls in November while wage increases rose 5.1%. and the unemployment rate remained stable at 3.7%.

Economists polled by Reuters predicted an average of 200,000 job creations, an average hourly wage up 4.6% and unemployment at 3.7%.

“Strong job creation and strong wage growth reinforce the Fed’s argument that much more needs to be done to get inflation under control,” said James Knightley, chief economist at ING.

Investors now rate the likelihood of a limited 50 basis point rise in the cost of credit on December 14 in the United States at 87% from 91% before the release of the jobs report, according to the real-time barometer FedWatch .

In the bond and money markets, US long-term yields rallied and the dollar also resumed its march forward, while interest-rate-sensitive tech stocks like Apple and Nvidia declined from 1.4% to 3.1%.

At the close in Europe, the Dow Jones fell 0.17%, the Standard & Poor’s 500 0.41% and the Nasdaq 0.67%, while most major sectors of the S&P-500 were in the red. .

VALUES

In Europe, the new technology compartment was among the biggest declines in the Stoxx 600.

Infineon, BE Semiconductor and ASML lost 0.7, 1.04% and 1.29% respectively, while in Paris Capgemini and Worldline fell by 0.53% and 2.31%.

In corporate news, Sanofi dropped 1.92% after saying that in the event of a bid for biotech company Horizon Therapeutics, it would be all in cash.

Credit Suisse rebounded 9.3%, its president Axel Lehmann having reassured investors on the capital outflows suffered by the bank.

RATE

Bond yields, down for much of the session, turned around after the release of the US jobs report.

That of the ten-year German Bund gained more than three basis points to 1.85% and the two-year more than seven points to 2.11%.

In the United States, the yield on ten-year Treasuries US10YT=RR rose by almost five points to 3.57% and the two-year by 8.4 points to 4.34%.

CHANGES

Reacting to the US employment figures, the dollar appreciated against a basket of benchmark currencies after falling in session to a low since June 29.

“Bigger-than-expected hiring may give the Fed more time to stay aggressive,” said Joe Manimbo, market analyst at Convera.

The euro hit a session low of $1.0429 after rising to $1.0544, its highest since late June.

OIL

Oil prices are volatile, struggling to find a clear direction as OPEC and its allies meet on Sunday and Europe otherwise seeks to cap Russian oil at $60 a barrel.

At the close of trading in Europe, Brent climbed 0.18% to 87.04 dollars a barrel and American light crude (West Texas Intermediate, WTI) 0.48% to 81.61 dollars.

(Written by Claude Chendjou, edited by Sophie Louet)

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