© Reuters. THE EUROPEAN STOCK MARKETS FALLING AT MID-SESSION
by Blandine Henault
PARIS (Reuters) – Wall Street is again expected to decline on Tuesday at the opening after its dip in the last two sessions, which has reduced the overall stock market performance and created a sharp resurgence of volatility, favoring a return to the active shelters.
The index futures new york reported an opening fall to 1.05% for the Dow Jones by 0.66% for the S&P 500 and 0.8% for the Nasdaq 100.
On Monday, the Dow Jones finished down 4.6% and the Standard & Poor’s 500 by 4.1%, their biggest decline since August 2011. The two indices, which have lost respectively 7% and 6.1%, cumulative during the two previous meetings, now display negative performances for 2018.
The shaking on Wall Street spread to Asia, where the Nikkei in Tokyo fell to 4.73%, and in Europe, where the indices have opened lower by more than 3% before somewhat limit their losses.
In Paris, the CAC 40 declined 2.34% to 5.161,95 points to 11.55 am GMT, returning to its level of mid-September. In Frankfurt, the Dax loose 2,23% and in London, the FTSE lost 2.36 per cent.
Index pan-european FTSEurofirst 300 gives up to 2.25%, the EuroStoxx 50 euro-zone yield with 2.34% and the Stoxx 600 folds down to 2.24%.
The prospect of an acceleration of inflation, fuelled by the figures of the average hourly wage in the United States published on Friday, has caused a new flare-up of fever on bond yields and raised concerns about a monetary tightening more pronounced than would be expected from the central banks.
CALM RETURNED ON BOND
The Vix volatility index has jumped more than 44 points while he was in the beginning of the year near a record low at least 9.0. It is up to levels not seen since August 2015, when fears over the chinese economy had shaken the global markets.
The yield on Treasuries to 10-year-old has climbed up to 2,8850% on Monday, before the resurgence of risk aversion do not favour a return to active shelters and only for the benefit of the bond market, yet the origin of the movement correction in the shares.
The yield on government bonds us 10-year evolves and to 2.71% on Tuesday and the Bund returns to 0,678% after a peak to 0,774%.
Other assets shelters for excellence, the gold advance of 0.24% and the yen is gaining 0.08 per cent against the dollar.
The greenback is up slightly against a basket of reference currencies and the euro is trading around 1,2380 dollar.
“In the short term, the demand for Treasuries indicates that the vicious cycle is likely to mark a pause, but the risk remains bearish, the bond is still too expensive”, say the strategists of Kepler Cheuvreux.
“We expect that the market is consolidating before a second correction”, warn they.
BNP SANCTIONED, EURONEXT SOUGHT
All european sectors evolves into the red Tuesday, but some values differ, the as well as rise.
The sharpest decline in the Stoxx 600 is for the online retailer in the uk Ocado (LON:OCDO), which loses 6,72% after it announced Tuesday a gross income annual less than market expectations.
Conversely, the specialist semi-conductors AMS takes of 8.15%, supported by a quarterly earnings increased more than tenfold thanks to demand for its sensors, which are fitted to many smartphones, including those from Apple (NASDAQ:AAPL).
In Paris, BNP Paribas (PA:BNPP), folds of 3.47%, after having reported an increase in its provisions for credit risk in its accounts for the fourth quarter.
The operator stock exchange Euronext (+0,47%) evolves, for its part, the head of the SBF 120, carried by the rise in trading volumes on the spot markets is likely to boost its sales. The volumes on the CAC represent, at the mid-session, which is already more than 88% of their daily average for the last three months.
On the oil market, the price of oil are not spared by the motion correction, with Brent returning to around us $ 67, the lowest since a month.
(Edited by Marc Angrand)