[ad_1]
Paris (awp/afp) – The markets were firmly awaiting Wednesday morning an exceptional meeting of the European Central Bank exposed to a risk of financial fragmentation in the euro zone and a clear signal from the American Federal Reserve (Fed) on its rate hike directors in the evening.
The European indices rebounded after six consecutive declines: Paris recovered 1.11%, Frankfurt 1.04%, London 0.54% and Milan 2.41% around 9:40 a.m. As for the Swiss Stock Exchange, it saw its flagship SMI index rebound shortly before 10:20 a.m. by 0.17%, after a brief stint in the red.
Asia ended mixed as the day before: the Chinese indices benefited from a favorable economic indicator but Tokyo lost 1.14%. Shanghai ended up 0.5% and Hong Kong gained 1% in the latest trade. Retail sales in China contracted in May for the third month in a row, but less abruptly, thanks to the lifting of health restrictions.
“Today all eyes will be on the Fed meeting. Markets and the latest data could force the Fed to raise its key rate by 75 basis points, the first since 1994, to 1.6%”, says Xavier Chapard, analyst at LBPAM. The option of a 50 basis point hike has not completely disappeared from the radar, but the 75 basis point hike has swelled in recent days after the publication of an acceleration in US consumer prices in may.
Upward revisions to central bank rate level expectations “accelerated after the ECB meeting and ahead of the Fed, Bank of England (Thursday) and Bank of Japan (Friday) meetings. “and weighed on all financial assets, specifies Mr. Chapard.
Stock market indices have experienced a bad streak in recent days and the bond market has also suffered a correction, victim of a massive disengagement for fear that the tightening of financial conditions will lead to a recession in the world’s largest economy. Consequently, yields on long-term bonds, which move in the opposite direction to their price, have reached new highs for years, thus penalizing the equity market.
But on Wednesday morning, the sovereign debt market was frankly relaxing after the surprise announcement of an exceptional meeting that the European Central Bank will hold on Wednesday morning, less than a week after announcing a tightening of its monetary policy to combat the inflation which has been accompanied by a widening gap in borrowing costs between the States of the euro zone.
The rates on the public debts of the so-called peripheral countries considered to be more fragile have increased much more than the German rates. But on Wednesday around 9:45 a.m., the Italian 10-year maturity yield (at 3.93%) fell back below the 4% threshold, a level crossed on Monday and dating back to the end of 2013.
ECB officials have already hammered home their readiness to act urgently if the risk of fragmentation in the sovereign debt market increases, but many observers have bemoaned the lack of a concrete solution presented by the institution.
Softbank’s ambitions for its subsidiary Arm
Tech investment giant SoftBank Group (-0.09% to 5,028 yen) is now planning to list its British microprocessor giant Arm subsidiary on the London Stock Exchange in addition to the New York Stock Exchange, according to reports. from the Bloomberg agency, which refers to a request from the British government to this effect. SoftBank Group announced at the beginning of the year that it wanted to list Arm on the stock market by the end of March 2023.
Whitbread does better than expected
The British group Whitbread, parent company of Premier Inn hotels, soared 3.74% to 2,662 pence around 9:50 a.m., after announcing sales “very solid and above expectations in the United Kingdom and Germany” for its first quarter. shifted.
Oil is stabilizing
Oil prices stabilized around 9:30 a.m.: the price of a barrel of American WTI climbed 0.04% to 118.97 dollars and that of a barrel of Brent from the North Sea crumbled by 0.10% to 121.05 dollars .
On the currency market, the euro rose 0.70% against the dollar, to 1.0490 dollars against 1.0416 dollars on Tuesday at 9:00 p.m. GMT.
afp/vj
[ad_2]
Source link
