PARIS (Reuters) – European stock markets ended hesitantly on Thursday, after the publication of inflation in the United States which surprised on the rise, in a context of messages from accommodating central bankers.
In Paris, the CAC 40 dropped 0.37% to 7,104.53 points, while the German Dax lost 0.23% and the British Footsie advanced 0.32%.
The EuroStoxx 50 index ended the session stable, compared to an increase of 0.19% for the FTSEurofirst 300 and 0.1% for the Stoxx 600.
American inflation, the main indicator expected this week, surprised on the rise by increasing by 3.7% year-on-year in September, against 3.6% expected by the consensus.
If the surprise remains moderate, investors are worried about underlying inflation supported by the high cost of rent and leisure goods and services, historically sensitive to rate increases. Markets must now contend with persistent price dynamics, labor markets remaining under pressure, and more cautious rhetoric from the American central bank, which is starting to worry about the impact of its monetary policy on bond markets.
The “minutes” of the Federal Reserve’s latest monetary policy meeting, published on Wednesday, encouraged the markets, with central bank officials being cautious in a context of economic uncertainty.
“This report on inflation should satisfy FOMC members, who have often emphasized the need to see inflation in non-housing services slow,” notes Bastien Drut, head of strategy and economic studies at CPR. -AM.
“The smaller than expected deceleration in housing-related inflation is probably a setback (this item remains volatile) and housing should indeed be a strong factor in lowering underlying inflation for the quarters to come.”
In Europe, encouraging statements from monetary policy makers follow one another: although there is no question of lowering rates yet, more and more members of the board of governors of the European Central Bank are of the opinion that rates are now sufficiently restrictive to bring inflation back to its target.
VALUES
Publicis raised its annual forecasts on Thursday after reporting organic growth in its net income above expectations in the third quarter, and granted itself 4.66%, leading the Stoxx 600. The media sector posted the best performance of the Stoxx 600, up 1.62%.
Luxury stocks continued their decline, after the disappointing figures from LVMH published on Tuesday. Kering, Hermes and LVMH lost 2.61%, 1.44% and 1.62% respectively, among the worst performances in the CAC 40. Casino announced on Wednesday an extension of the membership period for the “lock” agreement. -up” relating to the financial restructuring of the group, and fell by 10.73%.
Novo Nordisk gained 4.17%, among the best performers of the Stoxx 600, after reporting on Wednesday an encouraging clinical trial of its drug Ozempic on diabetic patients with kidney problems. Barclays fell 3.12%, after comments from the bank’s CEO on the outlook for profits in the banking sector, which he said were destined to deteriorate.
A WALL STREET
Wall Street hesitates at the closing time in Europe, digesting the contradictory messages sent by inflation data and the recent positioning of the Fed.
At closing time in Europe, trading on the New York Stock Exchange indicated a drop of 0.19% for the Dow Jones, against a stable Standard & Poor’s 500 and an increase of 0.19% for the Nasdaq Composite. .
RATE
Inflation is reigniting concerns about the trajectory of U.S. monetary policy, pushing bond yields higher.
At the close of the European interest rate markets, the ten-year Treasury yield rose 5.8 bp to 4.6533%, while the two-year rate rose 7.4 bp to 5.0792%.
The yield on the German ten-year rose by 6.4 bp to 2.782%, while that of the two-year rate rose by 5.8 bp to 3.158%.
CHANGES
The dollar surged after inflation as high rents sparked fears the Fed could keep rates in restrictive territory longer than investors expected.
The dollar rose 0.49% against a basket of reference currencies, while the euro lost 0.64% to 1.0549 dollars. The pound sterling fell 0.82% to $1.221.
OIL
Crude is advancing, supported by the slowdown in inflation in the United States, but lower-than-expected demand forecasts from the International Energy Agency and larger-than-expected oil inventories in the United States limit the earnings.
Brent rose 0.57% to $86.31 per barrel, with American light crude (West Texas Intermediate, WTI) rising 0.25% to $83.7.
(Written by Corentin Chappron, edited by Jean-Stéphane Brosse)
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