by Laetitia Volga
PARIS (Reuters) – Wall Street is expected to rise moderately and European stocks rose mid-session on Thursday, benefiting from the renewed risk appetite seen in most of the world’s major stock markets with the hope of an agreement on the debt ceiling of the United States.
Futures on New York indices signal an increase of 0.11% for the Dow Jones, 0.23% for the Standard & Poor’s-500 and 0.2% for the Nasdaq. In Paris, the CAC 40 gained 0.96% to 7,470.53 around 10:55 GMT.
In Frankfurt, the Dax takes 1.67%, the highest since January 2022, and in London, the FTSE 0.64%.
The pan-European FTSEurofirst 300 index advanced by 0.64%, the EuroStoxx 50 of the euro zone by 1.25% and the Stoxx 600 by 0.61%.
However, volumes are significantly reduced and the Swiss and Nordic markets are closed on Ascension Day, a public holiday in several countries. US President Joe Biden and the main Republican leader in Congress, Kevin McCarthy, on Wednesday underscored their determination to quickly reach an agreement to raise the federal debt ceiling.
The markets want to believe that a compromise will be found and passed by both houses of Congress before the government runs out of money to pay salaries, pensions or repay creditors, possibly as early as June 1.
“We haven’t had much concrete progress, but negotiations are continuing and all major players have reiterated that they want to avoid a default, which has helped reassure market participants,” the analysts wrote. Deutsche Bank strategists in a note.
Data on weekly jobless claims in the United States will be published at 12:30 GMT, as will the “Philly Fed” activity index.
IN WALL STREET
U.S. retail giant Walmart gained 2.7% in premarket after raising its annual sales and profit targets, driven by demand for its low-cost products, easing fears of a slowdown consumer spending against inflation.
Quarterly accounts from Target, Home Depot and TJX Companies this week showed consumers are turning away from non-essential products because of rising prices.
Cisco, one of the components of the Dow Jones, lost 3.6% in pre-market after announcing a significant drop in demand in the third quarter.
VALUES IN EUROPE
In Europe, Trigano climbed 11.16%, its strongest growth in eight months, after the announcement of its first-half results, which reflect continued strong demand for motorhomes.
In London, Burberry dropped 6.43% as the luxury group’s weak performance in the US market overshadowed higher-than-expected quarterly sales, thanks to the rebound in China.
British telecommunications operator BT Group fell 8.24% after announcing annual cash flow below expectations and its intention to cut up to 55,000 jobs by 2030.
RATE
Eurozone benchmark bond yields are up, a logical move in the face of rising equities and renewed appetite for riskier assets.
That of the ten-year German Bund rose to 2.409% and its French equivalent to 2.996%, both at their highest since the beginning of May.
The American ten-year is stabilizing around 3.5944%.
CHANGES
On the currency market, the upward movement observed recently on the dollar continues. The greenback took 0.26% against a basket of international currencies, after a peak of three weeks earlier in session.
After smashing the seven-to-the-dollar threshold for the first time in five months on Wednesday, the Chinese yuan continues to slide, amid geopolitical tensions and China’s post-COVID recovery faltering.
The euro fell back to $1.0812
OIL
The oil market fell a little after gaining nearly 3% the day before: Brent lost 0.31% to 76.72 dollars a barrel and American light crude (West Texas Intermediate, WTI) 0.29% to 72, $62.
(Laetitia Volga, edited by Blandine Hénault)
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