Stock market: what’s happening on the markets before the opening Friday May 24

Stock market: what’s happening on the markets before the opening Friday May 24
Stock market: what’s happening on the markets before the opening Friday May 24

(Photo: Getty Images)

MARKET REVIEWS. World stock markets are on a downward trend on Friday, not happy at the idea that the American central bank (Fed) could further delay its first rate cut after signals of resilience from the American economy.

Stock market indices at 8:00 a.m.

European and Asian markets were tumbling Friday morning as investors worried about inflation and interest rates.

London, Frankfurt And Paris lost between 0.4% and 0.6% at the start of the session in Europe.

In New York, before the markets opened, the average Dow Jones Industrial stocks and the broader S&P 500 index rose 0.1%.

In Asia, the Nikkei 225 fell 1.2% in Tokyo. The stock market of Shanghai fell by 0.9% and the Hang Seng plunged 1.5% in Hong Kong. Sydney lost 1.1% and Seoul 1.3%.

On the New York Commodity Exchange, the price of oil dropped 19 US cents to US$76.68 per barrel.

In the currency market, the Canadian dollar was trading at 72.98 US cents on Thursday evening, compared to 73.13 US cents on Wednesday.

The context

“The fear of interest rates is back and is weighing on the minds of market participants,” says independent analyst Andreas Lipkow.

Investors are still digesting the composite PMI index (all sectors combined), established by S&P Global to measure economic activity in the United States, published Thursday. It emerged in May at its highest level in 25 months.

If the services sector has sparked, the manufacturing industry has also seen a rise in power.

This picture of the American economy thus supports the hypothesis of a continuation of the aggressive monetary policy of the Fed, postponing the deadline for a first lowering of rates by the American monetary institution.

To bring inflation back to 2%, the Fed raised rates between March 2022 and July 2023, pushing them up to the range of 5.25-5.50%, their highest level in 20 years, and has remained at this level since.

“Currently, the hypotheses for a reduction in key rates in the United States” are based on “a small reduction in rates in September and another in December,” specifies Andreas Lipkow.

In terms of the European macroeconomy, Germany recorded an increase in its gross domestic product (GDP) in the first quarter, after having experienced a sharp decline at the end of last year and over the whole of 2023, weighed down by the crisis in its industry.

Between January and March, the largest economy in the euro zone experienced growth of 0.2% in its activity compared to the last quarter of 2023, according to final figures published by the statistical institute Destatis in a press release. Over one year, Germany, on the other hand, saw a drop of 0.9% in its GDP.

On the bond market, yields on long-term American and European government bonds remained at the same levels as the day before, after an increase during the session on Thursday following the publication of PMIs in the United States.

TotalEnergies corrects the situation

The CEO of TotalEnergies Patrick Pouyanné indicated on Thursday that he was studying a stock listing “in New York, as in Paris”, without commenting on the possibility of a main listing in the United States which has been in the news for several weeks.

Questioned by Le Figaro on the question of whether the group was indeed studying “a primary listing in New York”, the CEO mentioned “a translation error”: “A +primary listing+ in our mind is not a +main listing+ is the listing of the TotalEnergies share, in New York as in Paris,” explained the CEO.

The title dropped 0.18% on the Paris Stock Exchange.

Oil in decline

Oil prices were falling, weighed down by the prospect of high interest rates for longer in the United States, and in anticipation of the OPEC+ meeting, which will finally be held online at the beginning of June.

The price of a barrel of North Sea Brent for delivery in July fell 0.17%, to US$81.22.

That of West Texas Intermediate (WTI) American of the same maturity dropped 0.16%, to US$76.75.

The euro was up 0.23% against the greenback, at US$1.084 per euro.

THE bitcoin lost 0.68% to US$67,294.

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