by Diana Mandia
(Reuters) – Wall Street is expected to rise on Monday and European stock markets advance at mid-session, supported by signs of stabilization in the Chinese economy and ahead of decisions by the European Central Bank (ECB) on rates and figures of American inflation.
New York index futures signal Wall Street opening up 0.17% for the Dow Jones, 0.35% for the Standard & Poor’s-500 and 0.52% for the Nasdaq.
In Paris, the CAC 40 rose 0.59% to 7,283.41 around 10:45 GMT. In Frankfurt, the Dax advanced by 0.44% and in London, the FTSE by 0.18%.
The pan-European FTSEurofirst 300 index gained 0.38%, the EuroStoxx 50 of the euro zone 0.42% and the Stoxx 600 0.37%.
The return to positive territory of consumer prices in China, which reinforces hopes of stabilization of the second largest economy in the world, supports European stock markets on Monday, with investors on the lookout for any sign that the measures taken by Beijing to stimulate growth are bearing fruit.
In Europe, the ECB’s monetary policy meeting could result on Thursday in the announcement of a status quo on interest rates according to a majority of economists polled by Reuters, who appear very divided for the future.
The ECB’s decision is all the more awaited as it will follow a series of weaker than expected indicators in Europe. On Monday, the European Commission lowered its growth forecast for the euro zone to 0.8% this year and to 1.3% for the next, notably due to the expected recession in Germany.
In the United States, where inflationary pressures are resurfacing, investors will follow the publication of consumer prices (CPI) for the month of August on Wednesday.
VALUES TO FOLLOW AT WALL STREET
Tesla jumped 5.5% in pre-market trading after Morgan Stanley raised its recommendation on the group’s stock from “online weighting” to “overweight”, citing the potential of its Dojo supercomputer, intended to power electric models. artificial intelligence (AI) for autonomous vehicles.
VALUES IN EUROPE
The Stoxx 600 was driven on Monday by the basic resources compartment (+2.05%) in the wake of the rise in metal prices, investors betting on an improvement in demand in China.
The real estate index, for its part, gained 0.84% thanks to the hope of a lull in interest rates.
Covestro rose 2.91% as the German group began formal discussions with Abu Dhabi National Oil Company (ADNOC) on a takeover offer.
In Paris, JCDecaux jumped 6.98% thanks to the raising of Oddo BHF’s advice to “superperformance”, while Legrand lost 3.10% after Citigroup’s recommendation was lowered to “sell”.
RATE
Euro zone bond yields are rising in the wake of the ten-year Japanese government bond rate which reached its highest level in almost a decade on Monday in reaction to statements by the governor of the Bank of Japan (BoJ) , Kazuo Ueda.
The latter said that the Japanese central bank could end its negative interest rate policy when the 2% inflation target was in sight, according to the Yomiuri newspaper.
Traders are also looking to the ECB’s rate decision on Thursday.
The German ten-year yield thus gained more than 3 bp to 2.633%, and that of the two-year rate increased almost 2 bp to 3.087%.
The American bond markets are also progressing: the ten-year rate advances almost 4 basis points to 4.294%, while the two-year rate stands at 4.9948%.
CHANGES
The dollar, which last week recorded its eighth weekly increase in a row, the longest series in this direction since 2014, fell by 0.38% against a basket of reference currencies, while the euro advanced by 0. .29% to $1.073.
The yen strengthened by 0.66% to 146.84 yen per dollar, supported by the comments of Kazuo Ueda.
OIL
Oil retreats on profit-taking after climbing to 10-month highs last week on further production cuts.
Brent lost 0.49% to $90.21 per barrel and American light crude (West Texas Intermediate, WTI) lost 0.75% to $86.85.
(Written by Diana Mandiá, edited by Blandine Hénault)
Copyright © 2023 Thomson Reuters