Photo of the flags outside the New York Stock Exchange (NYSE) in New York
by Laetitia Volga
PARIS (Reuters) – Europe’s stock market rose on Thursday and Wall Street was expected to be in the green before the publication of monthly US inflation figures, while the rise in luxury stocks provided an additional boost to the Paris market.
Futures contracts on the main New York indices are signaling an increase of 0.49% for the Dow Jones, 0.47% for the Standard & Poor’s-500 and 0.59% for the Nasdaq.
In Paris, the CAC 40 gained 0.81% to 7,381.69 around 11:30 GMT. In Frankfurt, the Dax takes 0.45% and in London, the FTSE (+0.05%) is stable while the heavyweights HSBC (-1.16%) and Rio Tinto (-2.95%) are trading ex-dividend.
The pan-European FTSEurofirst 300 index advanced by 0.49%, the EuroStoxx 50 of the euro zone by 0.83% and the Stoxx 600 gained 0.41%.
The next test of renewed investor confidence is set for 12:30 GMT with the publication of monthly consumer price statistics in the United States, which could show a slight acceleration in inflation to 3.3% over one year according to the Reuters Consensus.
Core inflation should remain up 0.2% month-on-month and 4.8% year-on-year.
“Yes, the headline price index will rise, but due to base effects, so the Federal Reserve won’t care about that and core inflation will likely come down towards target, so it will be fine,” predicts Jane Foley, head of strategy at Rabobank.
WALL STREET VALUES TO FOLLOW
The luxury group Capri, owner of the Versace and Michael Kors brands, climbed 59% on the market after the announcement of its takeover by Tapestry for 8.5 billion dollars.
Disney shares rose 2% ahead of the US opening as the entertainment group’s third-quarter profit forecast came in above expectations.
VALUES IN EUROPE
The three French luxury giants Kering, LVMH and Hermès gain 1.74% to 2.30%, as China has decided to lift the ban on group travel to several countries, including the United States and Japan.
Tourism-oriented companies also benefit from this announcement, the airline Air France-KLM thus gaining nearly 2%.
The European insurance sector posted the strongest growth with a gain of 1.97% for its Stoxx index. Allianz gained 3.08% and took the lead in the Dax after reporting a half-year operating profit above expectations. In its wake, Axa takes 2.22% in Paris.
Siemens fell 5.98% after the German engineering group’s quarterly profit fell short of market targets.
RATES/EXCHANGES
The yield on ten-year Treasuries, at 4.0031%, varies little pending inflation statistics. It fell slightly the day before in response to strong demand for the Treasury auction: the ten-year one was oversubscribed 2.56 times, the highest ratio since February.
The dollar fell 0.37% against a basket of benchmark currencies and the euro took the opportunity to continue to rise, to more than 1.1 dollars.
OIL
Oil prices fell slightly after reaching multi-month peaks the day before under the combined effect of new production cuts announced by Saudi Arabia and Russia, and the war in Ukraine.
Brent fell 0.29% to 87.3 dollars a barrel and US light crude (West Texas Intermediate, WTI) 0.52% to 83.96 dollars.
(Laetitia Volga, edited by Jean-Stéphane Brosse)