A Spanish flag flies above the Madrid Stock Exchange
by Diana Mandia
The main European stock markets are expected to fall at the opening on Tuesday, weighed down by fears of an escalation in the Middle East, while traders reassess their bets on the next decisions of the American Federal Reserve (Fed) on rates .
Futures contracts report an opening down 1.09% for the Parisian CAC 40, 0.85% for the Dax in Frankfurt, 0.88% for the FTSE in London and 1.08% for the EuroStoxx 50.
Tensions in the Middle East, a year after the Hamas attack on Israel, continue to affect market confidence, with investors choosing to move away from risk amid fears that the conflict will persist and with it, the surge in crude oil prices and its repercussions on the economy.
Fears of escalation have already pushed Brent crude futures above $80 a barrel on Monday for the first time in more than a month.
Added to this are uncertainties over the Fed’s next steps in terms of borrowing costs, while the most recent indicators have shown that the labor market remains solid in the United States, which has led operators to abandoning their hopes for a 50 basis point rate cut in November in favor of a less aggressive 25 basis point cut.
Markets are also cautious ahead of the publication, scheduled for Thursday, of US inflation figures, which should give additional clues to the slowdown in prices.
In Europe, investors learned on Tuesday that German industrial production increased by 2.9% month-on-month in August, compared to a consensus of 0.8%, thanks to an improvement in production in the automobile industry.
VALUES TO FOLLOW:
Pernod Ricard, Rémy Cointreau will be monitored at the opening while China announced on Tuesday the establishment from October 11 of protectionist measures against imports of certain categories of spirits from the European Union, according to a statement from the ministry Chinese Commerce.
A WALL STREET
The New York Stock Exchange ended down on Monday, penalized by uncertainties linked to geopolitical tensions in the Middle East but also by fears of seeing the Fed procrastinating on the reduction of its key rate.
The Dow Jones index lost 0.94%, the broader Standard & Poor’s 500 lost 0.96% and the Nasdaq Composite fell 1.18%.
In stocks, Alphabet lost 2.5% after the American court ordered Google on Monday to overhaul its online application store to give Android device users more options for downloading applications. and make in-app purchases.
IN ASIA
Mainland China’s stock markets reopened on Tuesday with strong gains after a public holiday week, driven by the recovery measures recently announced by Beijing.
The composite index of the Shanghai Stock Exchange gained 3.2% after reaching a peak since December 2021 and the CSI 300 of large caps advanced 4.3%.
The Hong Kong Stock Exchange, however, lost 7.3%, weighed down by the real estate sector, although analysts said that technical reasons were probably behind the sell-off.
The chairman of the National Development and Reform Commission (NDRC), the Asian giant’s main economic planning body, said China was “fully confident” in its ability to achieve its economic goals for the entire country. year.
In Tokyo, the Nikkei index fell by 1% on Tuesday, in the wake of Wall Street the day before and weighed down by the rise in the yen.
Data released Tuesday also showed that inflation-adjusted wages fell in August in Japan and household spending also fell, although analysts said underlying trends point to a gradual recovery in wages and productivity. consumption and are expected to support the central bank’s plans for additional rate hikes.
In terms of values, Samsung Electronics said Tuesday that its third-quarter operating profit should have jumped 274%, an increase that was lower than analysts’ estimates as the South Korean giant struggled to benefit from the boom in demand for chips for artificial intelligence (AI).
RATES/EXCHANGES
Bond yields fell on Tuesday after their sharp rise the day before on both sides of the Atlantic amid reduced bets on a Fed rate cut in November.
The yield on ten-year Treasuries fell 2.6 basis points (bp) to 4.0003% and its two-year counterpart dropped 5.0 bp to 3.9541%.
The yield on the ten-year German Bund is stable (+0.5 bps) at 2.2560%, while that of the two-year bond is moving at 2.2310%.
On the foreign exchange market, the dollar, strengthened in recent days by solid data from the American economy, lost 0.12% against a basket of reference currencies, while the euro gained 0.09% to 1, 0984 dollar…
OIL
Oil prices fell on Tuesday after Monday’s surge, amid fears of escalation in the Middle East.
Brent fell 1.75% to $79.51 per barrel and American light crude (West Texas Intermediate, WTI) lost 1.81% to $75.74.
(Written by Diana Mandiá, edited by Augustin Turpin)
