by CORENTIN CHAPRON
PARIS (Reuters) – Wall Street is expected to rise at the opening on Friday, while European stock markets advance at mid-session, the slight easing of bond yields supporting risky assets.
Index futures suggest Wall Street opens in the green, with the Dow Jones up 0.24%, while the Standard & Poor’s 500 gains 0.43% and the Nasdaq 0.71%.
In Paris, the CAC 40 advanced 0.17% to 7,413.84 points around 11:25 GMT, compared to 0.39% for the FTSE in London. The Dax in Frankfurt gains 0.26%.
The pan-European FTSEurofirst 300 index rose by 0.15%, compared to 0.33% for the EuroStoxx 50 and 0.19% for the Stoxx 600.
Calm has returned to bond markets, with yields falling in Europe mid-session, pushing risky assets higher.
Since a low reached on December 28, the German 10-year yield has rebounded by 37 basis points, as investors revised their outlook for monetary policy easing.
The yield on the American 10-year rose by 33 bp over the same period.
The rebound in tech stocks, triggered Thursday by TSMC’s better-than-expected quarterly results, also contributes to the rise in European indices.
The markets will monitor this Friday the publication of the Michigan confidence index at 3:00 p.m. GMT, as well as housing resales in the United States at 3:00 p.m. GMT, which will make it possible to gauge the resistance of the American real estate market which has become one of the main inflation factors.
Investors are also positioning themselves for a busy week, with the next meeting of the European Central Bank taking place next Thursday, while the PCE inflation indicator will be published on Friday in the United States.
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VALUES TO FOLLOW IN WALL STREET
Amazon announced Friday that its Amazon Web Services (AWS) division plans to invest 14 billion euros in Japan by 2027 to develop its cloud computing services. Furthermore, according to the Wall Street Journal, the European Commission is considering blocking Amazon’s acquisition of IROBOT for an amount of $1.4 billion.
VALUES TO FOLLOW IN EUROPE
Teleperformance advances 6.67% after raising Stifel’s recommendation to “buy”.
KBC Group gained 3.5%, Morgan Stanley having raised its recommendation on the Belgian group to “overweight”.
Ericsson and Nokia fell 2.88% and 2.55% after Barclays lowered its recommendation from “online weighting” to “underweight”, citing “significant slowness” in the deployment of 5G in India and a decline in investment in telecommunications.
RATE
Bond yields appear hesitant, with rate markets digesting the latest data published this week and positioning themselves before the publication of the Michigan confidence index at 3:00 p.m. GMT.
The yield on the ten-year Treasury is holding steady at 4.1379%, while the two-year remains at 4.359%.
The German ten-year yield weakened by 2 bp to 2.288%, that of the two-year rate was stable at 2.687%.
CHANGES
The dollar is eroding but could record its second consecutive weekly gain, after the latest indicators highlighted the resilience of the US economy.
The dollar fell 0.16% against a basket of reference currencies, the euro gained 0.09% to 1.0884 dollars, and the pound sterling lost 0.16% to 1.2685 dollars.
OIL
The price of oil is rising moderately, supported by a drop in production in the United States linked to a cold snap and a resurgence in geopolitical tensions.
Brent nibbles 0.13% to $79.2 per barrel, American light crude (West Texas Intermediate, WTI) rises 0.24% to $74.26.
MAIN ECONOMIC INDICATOR ON THE AGENDA OF JANUARY 19:
COUNTRY GMT INDICATOR PERIOD PREVIOUS CONSENSUS
USA 3:00 p.m. January confidence index 70.0 69.7
Michigan (1st estimate)
(Written by Corentin Chappron, edited by Blandine Hénault)
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