The Paris Stock Exchange, which had tried this morning to continue its rebound, ended this Monday session down. the Bedroom 40 lost 0.43% today, to 6,047.31 points, in low trading volumes (2.9 billion euros), before a week rich in economic events. In New York, the Dow Jones, S&P 500 and Nasdaq Composite are hovering around balance.
Today, against a backdrop of high inflation that is forcing the world’s central banks to rapidly raise their benchmark interest rates, the ECB’s annual symposium begins in Sintra, Portugal. Christine Lagarde’s welcome speech began at 5:30 p.m. The symposium will last three days and will notably welcome the head of the American Federal Reserve, Jerome Powell. He told Congress last week that a soft landing for the US economy is a challenge and that a recession is a “possibility”. He also claimed that the Federal Reserve is “totally determined” to fight inflation.
Inflation will again be in the center of attention this week with the publication, on Thursday, of statistics on income and expenditure of American households. The price sub-component, which is closely watched by the Fed, will be of particular interest.
On the Old Continent, the figures for consumer prices in the euro zone will be released on Friday after those of Germany and Spain on Wednesday, and France on Thursday.
Today, in the United States, durable goods orders for the month of May were published: they increased by 0.7%, in preliminary data, against +0.1% expected and after an increase of 0, 4% in April. According to analysts at Capital Economics, these figures are consistent with a slowdown in the growth of business investment in equipment in the second quarter, rather than a reversal of the trend.
What about earnings forecasts?
Tonight, after Wall Street closes, Nike will release financial results for the fourth quarter of its 2021-2022 fiscal year, which ended at the end of May. This will be a first opportunity to measure the accuracy of analysts’ forecasts, in a very difficult macroeconomic environment.
According to Morgan Stanley strategists, European stocks have not yet priced in the risk of recession despite low valuation levels. “Equities markets tend to pull back two to three weeks before earnings forecasts start to be revised down, however, the latter have not yet started to slide into negative territory”, they point out. They expect the lowering of earnings guidance to begin in the third quarter.