Rebound in Europe after six consecutive sessions of decline

by Claude Chendjou

PARIS (Reuters) – European stocks closed in the green and Wall Street also rose at the close in New York, the session proving volatile after monthly US consumer price figures showed a stronger-than-expected acceleration. inflation, raising fears of significant monetary tightening next month.

In Paris, the CAC 40 finished with 1.04% at 5,879.19 points. Britain’s Footsie gained 0.35% and Germany’s Dax gained 1.51%.

The EuroStoxx 50 Index gained 0.93%, the FTSEurofirst 300 0.77% and the Stoxx 600 0.85%.

The rally in European equity markets came minutes before the close after six consecutive sessions of decline, while indices were in the red for much of the day.

This reversal was driven by Wall Street, where the S&P-500 index, which fell in the session to a low of almost two years, and the Dow Jones, at its lowest level since November 2020, returned to the green once digested the US inflation figures

The US Department of Labor said the CPI consumer price index accelerated to 0.4% in September and 8.2% year-on-year, while the “core CPI,” which measures inflation since the base, emerged with a monthly gain of 0.6% and 6.6% annually. base.

Economists polled by Reuters on average forecast increases for the CPI of 0.2% and 8.1%, and for the core CPI of 0.5% and 6.5% respectively.

Traders are pricing in a 91% chance of a fourth consecutive 75bp increase in the cost of credit on November 2, while the chance of a 100bp increase is estimated at 9%.

In Europe, where a sharp rate hike is also expected next month, it was confirmed on Thursday that inflation in Germany rose by 10.9% year-on-year in September.

SECURITIES IN EUROPE The technical rebound in Europe mainly benefited the transport and leisure segment (+3.44%), while the food and beverage segment (-1.13%) showed the greatest drop.

In individual stocks, Airbus (+3.91%), Safran (+4.85%) and Alstom (+3.91%) formed the top tier of the CAC 40. In contrast, Pernod Ricard (-2.54% ) and luxury groups Hermes (-2.29%), LVMH (-0.71%) and Kering (-0.51%) were among the stocks at the bottom of the pack.

In the rest of Europe, Monte dei Paschi di Siena (MPS) plummeted 33.14%. The Italian bank presented this Thursday the conditions of its capital increase scheduled for next week, which should allow it to raise up to 2,500 million euros of capital.

Norwegian aluminum producer Norsk Hydro, which rose 6.74 percent, was buoyed by news reports that Washington is considering restricting Russian aluminum imports.

ON WALL STREET

At the close of Europe, the Dow Jones advances 1.71%, the Standard & Poor’s 500 1.31% and the Nasdaq 0.81%

Corporate financial account releases drive the trend as analysts expect S&P corporate quarterly earnings to rise just 4.1% from 11.1% in the three months to July, according to Refinitiv data.

Applied Materials took 2.98% despite a warning about the impact of new US restrictions on exports to China.

World number one asset management firm Blackrock is up 2.93% and airline Delta Air Lines is up 3.83% following their results.

CHANGES

The dollar fell 0.94% against a basket of benchmark currencies despite a stronger-than-expected rise in US inflation.

The euro took the opportunity to return to 0.9765 dollars (+0.63%).

Sterling was up 2% at $1.1321 on the eve of the Bank of England halting emergency purchases.

SPEED

Bond yields in Europe ended lower after a volatile session. According to some analysts, such as Commerzbank’s Christoph Rieger, the bond market was split between US inflation numbers and reports that the UK government is considering revising its plan for massive tax cuts unveiled last month. .

The 10-year German Bund yield fell 4.7 basis points to 2.296%.

The British Gilt of the same maturity fell 20.9 points to 4.22%.

OIL

Oil prices rise again, with the US Energy Information Agency (EIA) reporting distillate inventories fell 4.9 million barrels in the week ending October 7, to 106.1 million. of barrels, the lowest level since May, when a drop of only two million barrels was expected.

Brent rose 2.06% to $94.35 a barrel and US light crude (West Texas Intermediate, WTI) rose 2.13% to $89.13.

TO FOLLOW ON FRIDAY:

Release at 12:30 GMT of US retail sales statistics for September.

THE MARKET SITUATION:

(Some data may show a slight change)

THE FENCE IN

EUROPE

Indices Last Var. Var. %THE LAST YEAR

Points

Eurofirst 300 1543.50 +11.77 +0.77% -18.34%

Eurostoxx 50 3362.40 +30.87 +0.93% -21.78%

CAC40 5,879.19 +60.72 +1.04% -17.81%

Dax 30 12,355.58 +183.32 +1.51% -22.22%

FTSE 6850.27 +24.12 +0.35% -7.23%

SMI 10227.90 +28.58 +0.28% -20.56%

The values ​​to follow

Paris and Europe:

[WATCH/LFR]

THE TREND TO

FINANCIAL WORLD

Indices Last Var. Var. %THE LAST YEAR

Points

Dow Jones 29744.54 +533.69 +1.83% -18.15%

S&P-500 3626.80 +49.77 +1.39% -23.91%

Nasdaq 10508.80 +91.70 +0.88% -32.83%

Nasdaq 100 10888.08 +102.46 +0.95% -33.28%

Minutes of the meeting in

Financial world: [.NFR]

“The Day Coming” – Update on the

next session on wall street [DAY/US]

CHANGES

Standby Price Var.% YTD

Euro/USD 0.9776 0.9704 +0.74% -14.00%

DLR/Yen 147.08 146.91 +0.12% +27.83%

Euro/Yen 143.81 142.54 +0.89% +10.35%

Dlr/CHF 0.9996 0.9973 +0.23% +9.58%

Euro/CHF 0.9774 0.9679 +0.98% -5.74%

Stg/Dlr 1.1329 1.1103 +2.04% -16.26%

Index $ 112.4180 113.3200 -0.80% +16.89%

PRAYED

Var. %THE LAST YEAR

Spot Gold 1666.01 1672.51 -0.39% +9.82%

SPEED

Last Var. Spread/Bund

(points)

Future Bonds 136.81 +0.97

10-year bonds 2.28 -0.01

2-year bond 1.90 -0.01

TAO at 10 years 2.87 -0.02 +59.00

10-year Treasury 3.95 +0.05

Treasury 2 years 4.43 +0.14

OIL

Previous price Var. Var.% YTD

US Light Crude 88.89 87.27 +1.62 +1.86% +45.22%

Brent 94.12 92.45 +1.67 +1.81% +42.54%

(Written by Claude Chendjou, edited by Sophie Louet)