(Reuters) – European stocks ended slightly lower on Wednesday but Wall Street rose mid-session as it awaits decisions from the U.S. Federal Reserve, which is expected to announce another interest rate hike but may moderate its rhetoric afterwards. recent signs of slowing inflation.
In Paris, the CAC 40 lost 0.21% (14.19 points) to 6,730.79 points. In London, the FTSE 100 was down 0.09% and in Frankfurt, the Dax was down 0.26%.
The EuroStoxx 50 index ended down 0.29% while the FTSEurofirst 300 gained 0.04% and the broader Stoxx 600 recorded a symbolic drop of 0.02%.
At the time of the close in Europe, the American Dow Jones won 0.71%, the Standard & Poor’s 500 0.72% and the Nasdaq Composite 0.77%.
The Fed’s Federal Open Market Committee (FOMC) is expected to announce at 7:00 p.m. GMT a further half-point hike in the fed funds rate target, but investors are mostly awaiting its new policy outlook. monetary policy, growth, inflation and unemployment while waiting for President Jerome Powell’s press conference at 7:30 p.m. GMT.
The markets’ main questions concern the scale of the next rate hikes and the possibility of a pause in monetary firming before the spring.
In Europe, they partly overshadowed the announcement of a slowdown in British inflation to 10.7% over one year in November, a level still well above the Bank of England’s (BoE) target. which meets on Thursday, as does the European Central Bank (ECB) and the Swiss and Norwegian central banks.
VALUES
In Europe, the biggest sectoral drop of the day was for the commodities compartment (-1.71%), once again affected by the health situation in China, which is weighing on base metal prices.
In Paris, ArcelorMittal lost 4.35% and in London, mining giant Rio Tinto dropped 2.18%.
For its part, the transport and leisure sector (-1.40%) was penalized by the 7.99% drop in the tour operator TUI, which announced its intention to carry out a capital increase to repay the public aid received during the COVID-19 crisis.
Carrefour lost 3.79% in the wake of Belgian Colruyt (-14.84%) heavily sanctioned after half-years below expectations.
On the rise, Inditex, the parent company of Zara, took 3.07% after its results.
CHANGES
The expectation of announcements from the Fed penalizes the dollar, which gives up 0.26% against other major currencies, not far from the low of six months hit on Tuesday after the statistics of US inflation.
The euro, which had exceeded 1.0670 dollars for the first time since June, is trading at 1.0657, up 0.25%.
The pound sterling only briefly lost ground after the British inflation figures and is now on the rise again against the greenback (+0.47%).
RATE
Benchmark eurozone bond yields ended the day higher, supported by information from Reuters, obtained from several sources within the institution, that forecasts presented on Thursday will include inflation still above 2% in 2025. .
The ten-year German, after a peak at 1.995% at the end of the morning, was displayed at 1.934% at the end of the session, up three basis points.
On the US market, the trend is more hesitant before the Fed’s announcements: the ten-year is stable at 3.5029% and the two-year fell more than five points to 4.1781%.
OIL
The oil market, which fell at the start of the day, is now up sharply, supported by forecasts from the International Energy Agency (IEA), which, like OPEC, expects solid demand next year.
The announcement by the US Energy Information Administration (EIA) of an unexpected increase in crude inventories in the United States last week only briefly weighed on prices.
Brent gained 2.27% to 82.51 dollars a barrel and American light crude (West Texas Intermediate, WTI) 2.32% to 77.14 dollars.
TO BE FOLLOWED ON THURSDAY:
In addition to the multiple monetary policy decisions expected in Europe, Thursday’s session will be driven by a flurry of US economic indicators, including November retail sales, weekly jobless claims and the “Philly Fed” activity index. “.
(Written by Marc Angrand)
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