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by Diana Mandia
(Reuters) – Wall Street is expected to fall on Monday and most European stock markets turned lower mid-session, the euphoria sparked by good US employment figures fading, while sensitive sectors interest rates are suffering from the rise in bond yields. New York index futures signal Wall Street opening down -0.44% for the Dow Jones, 0.52% for the Standard & Poor’s-500 and 0.69% for the Nasdaq. In Paris, the CAC 40 gained 0.10% to 7,549.14 points around 10:52 GMT, while in Frankfurt, the Dax fell 0.25%. In London, the FTSE 100 gained 0.35%.
The EuroStoxx 50 index is down 0.04%, the FTSEurofirst 300 is up 0.06% and the Stoxx 600 is down 0.03%.
Euro zone sovereign bond yields continued to rise on Monday, hurting stock markets, after US jobs data eased fears of a recession in the US economy and dampened expectations for a further 50 basis point reduction in interest rates from the Federal Reserve (Fed) in November.

“The employment figures give hope that the United States will not experience a recession. But, at the same time, there is disappointment that there will not be another massive rate cut,” said Susannah Streeter, analyst at Hargreaves Lansdown.
Traders now see it as more likely that the central bank will cut rates by 25 basis points in November, a sharp turnaround from last week, when most were betting on a 50 basis point cut. base.
“As the market (and the Fed) debated the probabilities between a soft landing scenario and that of a recession, the no-landing scenario in which inflationary pressures remain too high is back on the radar,” note for its part LBP AM.
In Europe, markets for their part have almost entirely priced in a further reduction of 25 basis points from the European Central Bank (ECB) at the meeting on October 17, with inflationary pressures easing more quickly than expected.
François Villeroy de Galhau, the governor of the Bank of France, also supported this scenario in an interview published Monday by the Italian newspaper La Repubblica, judging “very likely” a reduction in ECB rates this month in a context economic growth is weak.
Recent economic data from the euro zone are not exactly brilliant: in Germany, the bloc’s main economy, industrial orders fell much more than expected month-on-month in August, a sign of the difficulties facing the sector, while a A spokesperson for Germany’s Economy Ministry said Monday that the country’s GDP is expected to contract by 0.2% this year.
Investor morale in the euro zone saw an unexpected rise in October, after three consecutive months of decline, even though dissatisfaction with the current situation reached its lowest level of the year, according to an investigation published Monday.
A year after the October 7 attacks by Hamas in Israel, the conflict in the Middle East continues to raise market concerns, particularly on the impact that the rise in oil prices could have on the trajectory of inflation. .
The New York Stock Exchange is expected to open lower as investors reduce their bets on the size of rate cuts and caution is needed ahead of Thursday’s inflation data release and the third-quarter earnings season.
Rising Treasury yields are putting pressure on growth stocks and pushing big tech names like Nvidia, Amazon.com and Apple back in pre-market trading.
VALUES IN EUROPE
The real estate, technology and utilities sectors fell 1.2%, 1.3% and 0.1% respectively, hit by rising bond yields. In Paris, Ubisoft fell 4% after publishing a press release indicating that it took note of recent press speculation regarding potential interests around the company. Rumors circulated Friday about discussions between the Guillemot family and the Chinese company Tencent.
Atos, which declared on Monday that it wanted to continue discussions on its strategic assets with the French state after having failed to reach an agreement on Bercy’s offer aimed at buying certain strategic assets of the Big data and security (BDS) activity of the group, takes 0.3%.
Rubis gains 4.8% after announcing the launch of a share buyback plan for an amount of 50 million euros.
Elsewhere in Europe, Cartier owner Richemont is up 0.7% after agreeing to sell its online fashion and accessories business Yoox Net-A-Porter (YNAP) to German luxury fashion platform Mytheresa.
RATES Bond yields rose on Monday, as US labor market data released on Friday dashed traders’ hopes of another aggressive cut in borrowing costs from the Fed in November.
In the United States, the yield on ten-year Treasuries rose 2.5 basis points to 4.0061%, while that of the two-year bond, the most sensitive to rates, gained nearly 7 basis points at 4.0014%.
In the eurozone, the yield on the ten-year German Bund, the benchmark in the bloc, rose 3.8 basis points to 2.2520%, while its two-year counterpart gained 4.4 basis points to 2.2520. %.
CHANGES
On the currency market, the dollar, which reached its highest level in seven weeks on Friday after much better than expected data on job creation in the United States, remained up slightly on Monday, also benefiting from its quality a safe haven in the face of concerns about the conflict in the Middle East. The dollar thus gained 0.06% against a basket of reference currencies, while the euro lost 0.09% to 1.0966 dollars.
OIL
Oil prices are rising on Monday, with Brent nearing $80 after the biggest weekly rise since early 2023, on fears of wider conflict in the Middle East and disruption to exports from the main region oil producer.
Brent rose 2.05% to $79.65 per barrel and American light crude (West Texas Intermediate, WTI) rose 2.35% to $76.13.
NO MORE MAJOR INDICATOR ON TODAY’S AGENDA
(Some data may have a slight lag)
(Written by Diana Mandiá)
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