by Claude Chendjou
PARIS (Reuters) – Wall Street is expected to rise at the opening on Monday, while European stock markets begin the week with a mid-session rebound in a context of easing geopolitical tensions. New York index futures signal Wall Street opening up 0.50% for the Dow Jones, 0.59% for the Standard & Poor’s 500 and 0.73% for the Nasdaq. In Paris, the CAC 40 advanced 0.26% to 8,043.16 points around 10:35 GMT. In Frankfurt, the Dax gained 0.66%. In London, the FTSE, rich in raw materials, rose more clearly, by 1.44%.
The pan-European FTSEurofirst 300 index gained 0.46% and the EuroStoxx 50 of the euro zone 0.39%. The Stoxx 600, which recorded its third consecutive weekly decline on Friday, rebounded by 0.44%.
This rebound is led by cyclical stocks, notably in the banking sector (+0.82%) and energy (+1.14%).
The underlying trend, however, remains uncertain while the week will be marked, on a microeconomic level, by major company publications in Europe, particularly in the luxury sector (Hermès and Kering) and banking (BNP Paribas, Deutsche Bank, Barclays). In the United States, giants like Tesla, Meta Platforms and Boeing are expected.
A total of 158 S&P 500 companies and 173 Stoxx 600 companies are scheduled to report quarterly results this week, according to LSEG data.
On the macroeconomic level, the market awaits the American gross domestic product (GDP) figures for the first quarter on Thursday and the publication of the PCE inflation index and consumer spending for March in the United States on Friday.
The cautious return to risky assets comes as last week the market feared a conflagration in the Middle East after explosions reported in Iran, suggesting retaliation by Israel towards Tehran. Iranian Foreign Minister Hossein Amirabdollahian, however, downplayed the significance of this “incident”.
“It appears that neither Israel nor Iran wants an escalation of the Middle East crisis…and with subsequent strikes from both sides not appearing imminent, investor concerns have eased somewhat.” , notes Kazuo Kamitani, strategist at Nomura Securities.
VALUES TO FOLLOW AT WALL STREET
Tesla has reduced the price of certain models of its vehicles in China by nearly 2,000 dollars (around 1,870 euros), following a similar decision taken in the United States and several countries in Europe. The stock fell 2.7% before market trading amid fears of a price war.
Nvidia, which lost 10% on Friday, rebounded by 2.4% in pre-market trading on Monday, dragging in its wake Meta Platforms, Amazon and Alphabet, which rose by 0.3% to 0.9%.
VALUES IN EUROPE
Alstom is in the red (-0.16%) after announcing on Friday the sale of its conventional signaling activities in North America to the German railway systems manufacturer Knorr-Bremse (+4.26%) for around 630 million euros.
Galp Energia soars 17.58%. The Portuguese oil group has announced that its Mopane field off the coast of Namibia could contain at least 10 billion barrels of oil.
Iveco fell 3.42%, the Italian car manufacturer having announced the departure of its managing director Gerrit Marx to the American group CNH Industrial.
RATE
The yield on the ten-year German Bund, benchmark for the euro zone, rises by more than three basis points, to 2.539% as fears of an immediate military escalation in the Middle East have faded and investors have now attention focused on risks in terms of inflation and changes in key rates.
The yield on Treasury bills of the same maturity increases by almost four basis points, to 4.6559%.
CHANGES
The dollar remains firm (+0.04%) against a basket of reference currencies, including the euro which is trading at 1.0652 dollars (-0.02%) and the pound sterling at 1.2337 dollars (- 0.27%).
The dollar index saw strong volatility last week amid tensions in the Middle East, with Deutsche Bank’s currency volatility index rising 9.7% to its highest level since February.
OIL
The oil market is in decline against a backdrop of easing geopolitical tensions: Brent fell by 0.58% to 86.78 dollars per barrel and American light crude (West Texas Intermediate, WTI) by 0.40% to 82, 81 dollars.
The two oil benchmarks had gained more than three dollars per barrel on Friday at the start of trading after the explosions reported in Iran.
(Written by Claude Chendjou, edited by Blandine Hénault)
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