by Laetitia Volga
PARIS (Reuters) – European stock markets ended higher on Friday, resisting the decline on Wall Street where banks opened the ball for quarterly results by delivering messages of concern for the economy.
In Paris, the CAC 40 gained 0.69% to 7,023.5 points, the highest since mid-February. The British Footsie took 0.7% and the German Dax finished on an increase of 0.19%.
The EuroStoxx 50 index advanced 0.6%, the FTSEurofirst 300 0.56% and the Stoxx 600 0.54%.
At the time of the close in Europe, the Dow Jones on Wall Street was almost unchanged (+0.05%) while the Standard & Poor’s 500 and the Nasdaq Composite fell around 0.4%.
The US compartment of banking stocks lost up to 1.6% at the start of the session after the first quarterly publications of the heavyweights of the sector, which accumulated more provisions to ward off a possible recession.
Jamie Dimon, the chairman and chief executive of JPMorgan, listed a number of concerns facing the economy, including geopolitical tensions and runaway inflation, while the Bank of America boss spoke of an “economic environment of more slower”. “Some of the comments about fears of a recession and increased bank provisions are making more people nervous,” said Paul Nolte, portfolio manager at Kingsview Asset Management.
In Europe, the trend remained driven by the continued slowdown in inflation in the euro zone and the United States, which gave some players hope for a moderation in monetary tightening by the major central banks.
Over the week as a whole, the Stoxx 600 gained 1.66% and the CAC 40 by 2.37%.
VALUES
Among the biggest drops in the CAC 40, Stellantis (-3.81%) and Renault (-1.45%) were penalized by the price cut operated by Tesla (-3.86%) on some of these models, raising concerns that other automakers may be forced to follow suit.
Air France-KLM gained 5.99% after the advisory raised UBS to “buy” and Davy Research to “neutral”.
CHANGES
The yen continued its march forward (+1.05%), evolving to its highest since the end of May against the greenback, still driven by speculation that Japan could review its ultra-accommodative monetary policy.
The dollar rallied 0.13% against other major currencies after hitting a seven-month low, as moderating US inflation stoked hopes that the Fed would slow the pace of its interest rate hikes.
The euro is trading at 1.0803 dollars, down 0.4%.
RATES Yields on US government bonds are stabilizing at 3.4851% for the ten-year which had returned in the morning below 3.42%.
Its German equivalent ended slightly lower at 2.143%.
OIL
Oil prices are rising and could post a 7% jump for the week as a whole on solid signs of demand growth in China and hopes of central bank moderation in their rate hikes.
Brent gained 0.7% to 84.62 dollars a barrel and US light crude (West Texas Intermediate, WTI) 1.02% to 79.19 dollars.
(Laetitia Volga, edited by Nicolas Delame)