Caution in sight in Europe before US inflation – archyworldys

by Laetitia Volga

PARIS (Reuters) – The main European stock markets are expected to drop slightly at the opening on Wednesday pending the publication of monthly consumer price statistics in the United States.

According to the first indications available, the Parisian CAC 40 could lose 0.1% at the opening. Futures are reporting a decline of 0.14% for the Dax in Frankfurt, 0.21% for the FTSE in London and 0.14% for the EuroStoxx 50.

The US consumer price indicator for the month of October, which will fall at 12:30 GMT, two hours before the opening in New York, will be studied carefully against the backdrop of fears of prolonged inflation that will fall. could rekindle speculation about the timing of possible Federal Reserve (Fed) rate hikes.

The median of the estimates of economists polled by Reuters gives a figure of 4.3% year on year for the basic inflation index “core CPI” after 4.0% in September.

“These inflation figures are not likely to reassure anyone,” said Rob Carnell, economist at ING. “Higher than expected inflation for longer than expected is becoming market opinion right now and that opinion is likely to be reinforced.”

A WALL STREET

The New York Stock Exchange ended in the red Tuesday after a session marked by profit taking amid concerns about rising inflation. [.NFR]

The Dow Jones index lost 0.31% to 36,319.98 points, the S & P-500 lost 0.35% to 4,685.25 points and the Nasdaq Composite 0.60% to 15,886.54 points.

Last month’s producer price index was up 0.6%, in line with expectations, after gaining 0.5%.

On the securities side, Tesla (-12%) continued to fall in the wake of the poll organized on Twitter by its boss Elon Musk on the sale of 10% of its stake in the group while General Electric rose 2.6% to following the announcement of its split into three listed companies.

IN ASIA

The Nikkei index on the Tokyo Stock Exchange fell 0.61%, the latest results from a series of companies highlighting the fallout from rising commodity costs on their quarterly performance.

Thus, the steelmaker Mitsubishi Materials (-7.36%), the tire manufacturer Sumitomo Rubber (-13.08%) and the IT group Elecom (-10.62%) finished in the red after lowering their profit forecasts.

In contrast, Nissan climbed 7.51% after raising its forecast for annual operating profit.

Mainland China’s CSI 300 (-1.05%) and Shanghai Composite Index (-0.93%) fell in session to their lowest in more than two months after the release of producer prices which accelerated in October at the fastest pace since 1995.

“The risk of stagflation continues to increase. We are concerned about the likely pass-through of producer prices to consumer prices (…) This could limit the People’s Bank of China room for maneuver in terms of easing of its monetary policy in 2022, “said Zhiwei Zhang, chief economist at Pinpoint Asset Management.

CHANGES / RATES

The dollar takes nearly 0.1% against a benchmark basket after three sessions of decline.

The euro is also little changed, around $ 1.158.

On the bond market, the yield on ten-year Treasuries rose very slightly, to 1.4609%.

OIL

Oil prices continue to advance after having clearly benefited the day before from the surprise drop in crude stocks in the United States last week as travel demand resumes.

A barrel of Brent gained 0.6% to 85.29 dollars and US light crude 0.31% to 84.41 dollars.

(Laetitia Volga, edited by Blandine Hénault)