The shares suffer, and the euro increased before the ECB


© Reuters. EUROPE ENDS IN THE RED

by Patrick Vignal

PARIS (Reuters) – The european stock markets have finished Wednesday sharply in the red, penalised by the strength of the euro on the background of the fall of the dollar on the eve of the first meeting monetary the year of the european central Bank (ECB).

The euro rose during the session 1.24 dollar, for the first time since December 2014, supported by the fall in the dollar after the tone protectionist policies adopted by senior administration officials Trump on the occasion of the Davos economic Forum.

The strength of the euro is seen as a brake on the willingness of tightening of the ECB, which is expected to announce Thursday that it is continuing its asset purchases until at least September. The markets do not expect to raise rates before mid-2019.

On the side of the Fellowships in Europe, the CAC 40 lost 0.72% to 5.495,16 points. The Footsie british, sanctioned for its part by a strong increase of the british pound, fell to 1.14% and the German Dax dropped 1.07 per cent.

The index EuroStoxx 50 has lost 0,79%, the FTSEurofirst 300 0.33 percent and the Stoxx europe 600 index 0.5 percent.

Most of the sectoral indices ended lower, including the compartment technology, which sold to 1.66% with, in Paris, for a decrease of 6.28 per cent for STMicroelectronics (PA:STM) after negative comments from JPMorgan (NYSE:JPM), which foresees a slowdown in orders from Apple (NASDAQ:AAPL) from its suppliers for the iPhone X. AMS (-9%) has also been sanctioned after this note.

Side actions, the fact of the day is the dramatic drop-off of Suez (PA:SEVI), which has plunged 16.77% after a warning on its results, endorsed by a number of rating downgrades recommendation.

The title of the French group of services to communities has experienced the worst session in its history in the stock market and leaded to the Stoxx sector, which has abandoned was 1.41%.

THE DOLLAR CONTINUES TO DECLINE

On the foreign exchange market, the euro has taken up more than 0.8% against the dollar, which has yielded up to nearly 1% against a basket of currencies reference.

The european single currency has been supported by good news on the health of the private sector in the euro area, as well as by the remarks of the u.s. secretary of the Treasury, Steven Mnuchin, for which the drop in the greenback is a good thing for american commerce.

Several high-ranking officials of the administration to Trump rejected Wednesday in Davos the idea that the policy of”America First” advocated by the american president would be harmful to the globalization and world trade.

The asset purchases of the ECB have not had an impact “statistically significant” on the exchange rate of the euro and the currency fluctuations are mere side effect, not the purpose, of this policy, said on Wednesday, Mario Draghi, the president of the institution of Frankfurt, in a warm-up for his press conference on Thursday.

The euro has gained 14% against the dollar in 2017, and still more than 3% since the beginning of the year.

Gold is taking advantage of the weakness of the us dollar and is trading at more than 1.350 dollars per ounce for the first time since the beginning of September.

On the bond market, government bond yields remain on the upside, at 0.59% for the ten-year German against 0,562% on Tuesday closing.

On the front of the oil, a barrel of light crude, american crude oil (WTI) broke briefly to $ 65 after the announcement of a decrease in crude inventories in the United States last week.

The Brent of the North sea pulls back to his hand slightly, around 69,70 dollars.

At the time of closing in Europe, the Dow Jones (+0,21%), driven by financial values, is heading for a record closing. The S&P 500 is virtually unchanged and the Nasdaq yield of 0.56%, with a decline of more than 1% for Apple.

(edited by Wilfrid Exbrayat)

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