© Reuters. EUROPEAN STOCK MARKETS RISE IN MID-SESSION
by Patrick Vignal
PARIS (Reuters) – europe’s main stock Exchanges are based in the green Thursday at the mid-session in a climate of low volatility and Wall Street is reported on the rise, but the trend may change after the publication of a very followed by the inflation and data on the labour market in the United States.
This last day of the quarter for the markets therefore remains undecided after stumbling on Wall Street the day before, in a context still dominated by the fears of trade war and the questions about the values of technology.
In Paris, the CAC 40 takes 0.61% to 5.161,67 points to 10h35 GMT. In Frankfurt, the Dax gaining 0,88% and in London, the FTSE ahead 0.4%.
Index pan-european FTSEurofirst 300 rose to 0.44%, the EuroStoxx 50 for the euro area to 0.75% and the Stoxx 600 is 0.45%.
The index futures new york indicate an opening of Wall Street up 0.3% to 0.4% for the Dow Jones and the Standard & Poor’s 500 and 0.7% for the Nasdaq composite.
In Europe, the cyclical sectors, which had suffered on Wednesday, returning to the front like a car (+2,03%), basic resources (+1,61%) and distribution (+0.7 per cent). In contrast, the community services (“utilities”) drop of 0.37%.
The risk aversion that has benefited the compartments on the defensive, such as utilities has also fostered a sharp decline in bond yields: one of the German Bund and ten-year German oscillates around the threshold level of 0.50% compared to close of 0.58% at the end of last week and the ten-year-old american is returning to of 2.77% against 2.9% a week ago.
The european and u.s. markets will be closed on Friday, before the Easter weekend and this Thursday is the final session of a difficult quarter for the equity markets. The S&P-500 is heading towards a decline of more than 2.5% in three months, its first quarterly performance negative since the third quarter of 2015.
The Stoxx 600 displays at mid-session Thursday, a decline of 4.7% since 1 January and the CAC-40 with a decline of 2.8% after its stagnation in October-December.
The MSCI world index, which brings together 47 developed and emerging markets, yields for its share of 2.26 per cent on three months, after six consecutive quarters of growth.
“The concerns related to the disruption of world trade, the slowdown in economic activity, and now the fear of seeing the technology sector become the target of changes in regulation and increased taxation have created a climate of ‘storm of the century” combining uncertainty and doubt in the minds of investors, while complacency was dominant at the beginning of the year,” says Michael Hewson, of CMC Markets.
Other analysts are less alarmist, the image of Nicolas Chéron, head of research markets for Binck.fr.
“Even if the volatility is exacerbated and that the materials have been put to the test, it is clear that the markets bent but did not break,” he wrote.
On the foreign exchange market, the”dollar index”, which measures the evolution of the greenback opposite a basket of reference stabilizes after an increase of 0.8% Wednesday, its biggest increase on a session since mid-October.
The rebound of the american currency has brought the euro to around 1.23 us dollar, which is 1.4% below its peak on Tuesday (1,2476).
The INDEX “CORE PCE” in THE MENU
Traders will be watching in particular the monthly statistics of revenue and expenditure of the households in the United States at 12.30 GMT, which include the consumer price index “core PCE”, the barometer of inflation, the most closely watched by the federal Reserve.
At the same time will fall the figures for weekly jobless claims.
Thirty minutes earlier, the investors have acquired knowledge of a first estimate of the inflation German in the month of march.
Values in Europe, Sodexo (PA:EXHO) fall of 12,99%, after revised net downward its growth forecasts for its annual results following a quarter below its own expectations.
The increase, Renault (PA:RENA) won 4,87%, the largest increase in the CAC, according to an article by Bloomberg referring to its round of discussions between the automotive group and its japanese ally Nissan (T:7201) in view of a possible merger.
Also in the news of mergers and acquisitions, the reinsurer Swiss Re (SIX:SRENH) takes to 2.71% after reports that the japanese SoftBank could take a quarter of its share capital to 9.6 billion dollars (7.8 billion euros).
The price of oil are reluctant, torn between the prospect of an extension of the agreements governing the production and announcement of an unexpected rise in inventories in the United States.
The price of a barrel of Brent remains under $ 70 and that of light crude to u.s. West Texas Intermediate, WTI) in $ 65.
(Edited by Marc Angrand)