This is the most important session of the week, and perhaps of the month. It is at 2:30 p.m. that the long-awaited US inflation figures for the month of July will be published. The planet Stock Exchange holds its breath, with the hope that an appeasement will be observed on reading the evolution of consumer prices across the Atlantic, the only sign that would be likely to see the Fed be a little less aggressive in its current policy of monetary tightening.
In the first exchanges, the Bedroom 40 is very logically very cautious, down 0.32% to 6,469.28 points.
Since the publication on Friday of very solid employment data for the past month, with more than 500,000 job creations, twice as many as expected, coupled with an unemployment rate of 3.5%, the lowest since At the end of the 1960s and, above all, to a surge in the average hourly wage, up sharply by 5.2% over one year, the market expects nearly 70% on a further 75 basis point rise in key interest rates in United States in September, as at the last two meetings.
8.7% and 6.1%, the figures to watch
The analysts’ consensus hopes that inflation will return to 8.7% year on year, a pullback from the peak of 9.1% in June, which would nevertheless be largely explained by the decline of more than 10 % of energy prices. Because, excluding volatile elements, namely food and energy, price increases should remain strong, at 6.1% in July, against 5.9% the previous month.
” A figure in line with expectations, or ideally lower, will certainly temper Federal Reserve expectations, pull US yields lower and trigger a relief rally in equity markets. », Analyzes Ipek Ozkardeskaya, at Swissquote. Otherwise, ” higher-than-expected inflation, or worse, a reading above last month’s 9.1% would revive expectations that the Fed would continue to hike rates sharply – especially as the jobs market looks surprisingly resilient, to Fed tightening so far. This would push up US yields and lead to a correction in the July stock market rally. This Wednesday morning, the yield on US 10-year bonds stood at 2.803%, with the two-year bond still much higher at 3.272%.
Much more limited inflation in China
” Just two months ago, the release sent the S&P 500 to year-to-date lows and helped the Fed accelerate its rate of hike to 75 basis points, remembers, for his part, Jim Reid, at Deutsche Bank. Reply in a few hours now.
In the meantime, initiatives have of course remained very limited in New York, the Dow yielding 0.18% when the Nasdaq Composite, weighed down by its semiconductor values after the Micron alert, lost more than 1%. Asian markets are also in the red this morning. Inflation figures were similarly on the agenda in China. While consumer prices increased by 2.7% in July over one year, their strongest increase since June 2020, the increase is a little less significant than the consensus expected (2.9%). Producer prices rose by 4.2%, again below analysts’ fears (+4.8%).
On the business side, EDF filed a contentious appeal with the Council of State, and a claim for compensation, for an amount estimated at 8.34 billion euros, in order to compensate for the loss of earnings linked to the implementation of the tariff shield on the prices of electricity. Few price changes to expect, however, given the current takeover bid at 12 euros per share.
colas Rail, a subsidiary of Bouygues, will set up in Germany with the acquisition of Hasselmann, which specializes in the construction of railways and railway infrastructure. The Colas share rose by 3%.
Arkema loses almost 2%. HSBC reduced its price target from 164 to 123 euros.