The week had started rather well for equity indices, market sentiment was gradually calming down, but yesterday a new squadron of bad news flew over the trading rooms and caused quite a mess. Growing concerns about the real state of global growth are infecting the travel industry, most airlines and hotels are backing down significantly yesterday and Shanghai’s new partial city lockdown is not exactly reassuring. The eyes of the speakers are turned towards Christine Lagarde and the European Central Bank (ECB), I come back to this, and everyone ignores the weekly report on unemployment benefit claims in the United States, which is rising sharply again with 229,000 requests, the highest figure since July last year. The market and economic statistics are therefore increasingly calling into question the ability of the global economy to continue to grow and, above all, not to make a hard landing. At the same time, the crutch of the past few days (China stocks listed on Wall Street) is taking the day off. ETF KWEB tumbles 6.7% while Alibaba slips 8.1% after Chinese authorities denied plans to revive Jack Ma’s IPO of Ant. Don’t blame BABA for this said, it remains up 35% since its May 25 low.

As we can see, the market is having a rather complicated Thursday, nothing encourages optimism and the main course of the day (the ECB) only adds fuel to the fire. The European Central Bank raises its inflation forecasts and reduces its short-term growth prospects. The central bank guides the market to a rise of 25 basis points in July, it is a little less than previously expected, but the ECB adds that “if the medium-term inflation outlook persists or worsens , a “larger increase” will be appropriate in September”. Read: The ECB opens the door to a 50 basis point hike in September and that decision will depend on the statistics to come by then. We are therefore faced with an ECB dove in the short term and hawk in the medium term. We will say that in the end the message is a little more alarmist than expected and that is all the market is taking in, which sends bond yields on European government bonds to the sky. The German 10-year Bund takes off by 10 basis points and returns 1.45% this morning, the French OAT returns to 2.01% and one of the most marked movements occurs in Italy, where the 10-year climbs by 22 points base in one move to reach 3.65%. This more marked increase is explained by the fact that the Italian debt is perceived by market participants as more risky. Let us remember that the ECB has remained accommodating for a very long time, in particular to provide support to the Italian banking system, which is in great need of financing.

There is one that does not benefit from the ECB yesterday, it is the euro, which takes off at first to finally go south and trade at 1.0630 against the dollar this morning. In the end, this morning the market is pricing in a probability of a 200 basis point increase by the end of the year.

Volatility resumes its upward path almost everywhere, the VIX (volatility of the SPX) recovers 9.35% and closes at 26.20. It is easy to understand that nervousness is trying to come back, the first test of the week (the ECB) is rather unsuccessful and today is CPI day in the United States, the very important consumer price index will be published at 2:30 p.m. from Geneva. Economists predict an 8.3% year-on-year increase in May, which would mark a stagnation compared to the April figure. Either way, all the eyes of the financial world will be fixed on this oh so important statistic today.

The CAC40 has outperformed other major European indices during Emmanuel Macron’s presidency, but a shake-up in the legislative elections could hurt sentiment. A high score from the left-wing alliance led by Jean-Luc Mélenchon would likely lead to a negative reaction in the stock prices of banks and luxury stocks, according to IG France’s Alexandre Baradez. “All sectors that would suffer a tax increase with the far left risk being targeted,” he adds.

US inflation for May will therefore be published at 2:30 p.m. The University of Michigan Consumer Confidence Index is due at 4:00 p.m. This morning, China reported May inflation of 2.1%, slightly lower than expected. Chinese producer prices are trending in line with expectations (+6.4%), a rate lower than that of April (+8%).

ABB: Citigroup remains buyer with a target reduced from 40 to 35 francs. Aryzta: Kepler Cheuvreux goes from lightening to keeping, aiming for 1.10 francs. CRH: Berenberg remains on the buy side with a price target reduced from 56 to 46 euros. Holcim: Berenberg remains short with a price target reduced from 43 to 42 francs. Saint-Gobain: Berenberg remains to be kept with a target for reduced from 62 to 60 euros. Swisscom: UBS goes from neutral to sell by aiming for 500 francs. State Street officially denies its interest in Credit Suisse. The Apollo fund is said to be among the potential contenders to take over the Grubhub division of Just Eat. Ferrari plans to expand its Italian factory for electric vehicles.

After the close of Wall Street AMD announces optimistic sales forecasts and expects a gain in market share. Advanced Micro Devices, the second-largest maker of computer processors, expects revenue to grow 20% annually over the next three to four years as it tries to grab more market share at Intel. Revenue will grow faster than the broader chip market, CEO Lisa Su says in a meeting with investors. And the gross margin will increase to exceed 57%, she announces. It’s always interesting to know how the major players in the semiconductor industry are faring, AMD gains 1.2% in the aftermarket.

Tonight and this morning in Asia, the indices are trading in the red, with the exception of Hong Kong and Shanghai which gained 0.05% and 1.40%. Tokyo drops 1.49% to the bell and Seoul loses 1.13%. The SPX future traded very slightly higher and Europe opened down 0.9%.