The French flag on top of the Palais Brongniard, former Paris Stock Exchange
by Laetitia Volga
PARIS (Reuters) – Major European stocks are expected to fall moderately on Tuesday on lingering concerns about rising central bank rates, inflation and the unfolding war in Ukraine.
Futures contracts show a drop of 0.24% for the Paris CAC 40, 0.28% for the Frankfurt Dax, 0.45% for the London FTSE and 0.39% for the EuroStoxx 50 .
Les investisseurs devraient, comme lundi, limit la prize de risque, l’intensification de la guerre en Ukraine s’ajoutant à la crainte grandissante de récession avec en toile de fond, la perspective de taux d’intérêt toujours plus élevés face à la hausse prices.
In this context, the publication on Thursday of the inflation figures in the United States will be a great meeting for the markets.
“Inflation is stubborn and the Federal Reserve needs to go beyond what the market expects,” said Tai Hui, head of Asia-Pacific market strategy at JPMorgan Asset Management.
This week the quarterly results and especially the forecasts of the companies are also expected. In Europe, LVMH will post its third-quarter sales after the market closes, and in the United States, major banks including JPMorgan and Wells Fargo will launch the season on Friday.
Before, the day will be animated by the new forecasts of the International Monetary Fund (IMF) for the world economy at 13:00 GMT.
ON WALL STREET
The New York Stock Exchange closed lower on Monday, with the Nasdaq closing at a closing low, on concerns about the impact of the Fed rate hike and the pullback in the semiconductor sector in reaction to the United States decision to impose new controls on Porcelain exports.
The Dow Jones index fell 0.32%, or 93.91 points, to 29,202.88 points, the S&P-500 lost 26.80 points, or 0.74%, to 3,612.86 points and the Nasdaq Composite fell 110.3 points (-1.04%) to 10,542.10 points.
Shares of AMD, Micron, Nvidia and Qualcomm fell 1% to 5.2%.
Futures contracts are currently signaling a drop of around 0.45%.
The Tokyo Nikkei closed down 2.64% after a three-day weekend weighed down by losses in technology stocks.
The new US restrictions on the sale of semiconductors in China weighed down Japanese companies linked to chip production: Tokyo Electron fell 5.49% and Fanuc 3.93%.
Hong Kong’s Hang Seng slumped 1.75% as Beijing’s determination to stick to a “zero COVID” policy despite rising local cases of the disease adds to concerns about tighter restrictions. on COVID-19, US technology exports to China, and rising rates abroad.
By contrast, after a four-session run in the red, the CSI 300 and Shanghai SSE Composite rose on the back of rising new energy stocks, with industry watchers expecting strong quarterly results.
Risk aversion is benefiting the dollar, which is up 0.19% against a basket of majors, with the euro hovering around $0.969.
The pound slightly extended its losses after the Bank of England’s decision to extend its temporary security purchase program to indexed British government bonds.
As for government bonds, the US market is on the up after being closed the day before for Columbus Day. The ten-year US Treasury bond yield rose to its highest level in two weeks, by more than 4%, as the fall in the British bond market on Monday reverberated across the Atlantic .
In Europe, the ten-year German fell slightly to 2.307% in the first stock markets and its British equivalent also lost ground, to 4.46%.
The oil market fell slightly on the strength of the dollar and the resurgence of local COVID-19 cases in China, raising fears of a slowdown in global demand.
Brent crude lost 0.18% to $96.02 a barrel and US light crude (West Texas Intermediate, WTI) lost 0.3% to $90.86.
(Laetitia Volga, editing by Kate Enterringer)
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