Sharp rebound in equities, relief on US debt and inflation – archyworldys

PARIS (Reuters) – European equities posted their best performance in two and a half months on Thursday and Wall Street amplified its mid-session rebound, the easing in energy prices and the postponement of the deadline for the ceiling of the US debt having rekindled investors’ appetite for risk.

In Paris, the CAC 40 gained 1.65% (107.07 points) to 6,600.19 points, its best close since September 27. In London, the FTSE 100 advanced 1.26% and in Frankfurt, the Dax gained 1.85%.

At the close, the EuroStoxx 50 index posted an increase of 2.14%, the FTSEurofirst 300 of 1.67% and the Stoxx 600 of 1.6%, its largest increase in one session since July 21.

At the time of closing in Europe, Wall Street was also upbeat, with the Dow Jones gaining 1.48%, the Standard & Poor’s 500 1.4% and the Nasdaq Composite 1.64%.

American stocks thus welcomed the confirmation by the leader of the Democrats in the Senate in Washington of an agreement with the Republican camp to postpone the deadline for the debt ceiling to early December, which removes the risk of a state default. -United.

In Europe, this factor is added to the easing in oil and natural gas prices, the surge of which in recent days had fueled fears of a slowdown in growth accompanied by an inflationary surge.

The debate on inflation is however far from over: Isabel Schnabel, one of the members of the executive board of the European Central Bank (ECB), estimated that the acceleration of the rise in prices could continue while the Governor of the Banque de France, François Villeroy de Galhau, said he expected inflation to return to below 2% within a year.

Over the first four sessions of the week, the Stoxx 600 and the CAC 40 posted gains of over 1.25%.

VALUES

The rebound in European markets benefited all sectors of the stock market, but especially those that had suffered the most from the drop in previous sessions, such as that of commodities, for which the Stoxx index regained 3%, or that of automotive (+ 3.15%).

In Paris, ArcelorMittal (+ 4.04%) and Stellantis (+ 3.78%) are thus in the leading pack of the CAC 40.

The construction sector benefited from comments deemed reassuring from Swiss Sika on the impact of price increases: Sika shares gained 3% and Saint-Gobain 4.23%.

TODAY’S INDICATORS

In the United States, jobless claims last week recorded their largest drop in three months, to 326,000 against 364,000 the previous week.

In Germany, industrial production fell 4.0% in August, a much sharper decline than expected, mainly due to the drop in automobile production linked to component shortages.

CHANGES

Investors’ renewed appetite for risk and position adjustments ahead of monthly US employment figures push the dollar away from its recent highs: the greenback is down 0.17% against a basket of benchmark currencies.

The euro goes back to 1.156 dollars against 1.1527 at its lowest on Wednesday.

The pound sterling is advancing more sharply, again driven by expectations of a hike in rates from the Bank of England.

RATE

Eurozone benchmark yields ended the day down slightly as inflation fears ebbed, an easing that the minutes of the last European Central Bank (ECB) meeting did not reflect. cause.

That of the ten-year German Bund fell just under one basis point on the day to -0.189%.

On the US bond market, on the contrary, yields are on the rise, with investors’ attention turning to monthly US employment figures. The ten-year period goes back to 1.566%, up 3.5 points on the session.

OIL

Trending downward since the start of the day, the oil market started to rise again at the very end of European trading but remains far from the highs reached on Wednesday.

Brent, which had climbed to 83.47 dollars a barrel, gained 0.94% to 81.84 dollars after a low of 79.08 and US light crude (West Texas Intermediate, WTI) took 0.87% to 78.10 dollars against 79.78 at the highest the day before.

(Report Marc Angrand)