Iranian missiles are launched from a location indicated as Tehran
by Claude Chendjou
The European stock markets ended a new session in dispersed order marked by – strong volatility against a backdrop of renewed tensions in the Middle East and while awaiting monetary policy decisions from the European Central Bank (ECB).
In Paris, the CAC 40 ended with a loss of –0.51% at 8,161.83 points. The British Footsie gained 0.27%, standing out thanks to energy values. The German Dax fell by 0.88%.
The EuroStoxx 50 index lost 0.66%, the FTSEurofirst 300 nibbled 0.03% and the Stoxx 600 lost 0.08%.
At the time of closing in Europe, the Dow Jones fell by 1.14%, the Standard & Poor’s 500 by 0.83% and the Nasdaq by 1.06%, the major American indices being weighed down by the new technologies compartment (-1.20%) and that of semiconductors (-2.05%).
The VIX volatility index on Wall Street, a barometer of fear, climbed in session to a peak since April 7, while in Europe it exceeded the threshold of ​20 points on the EuroStoxx 50.
American President Donald Trump, who has continued to alternate threats and optimistic predictions since the start of the war against Iran on February 28, declared on Wednesday that Tehran was going to “pay the price” for its alleged procrastination in the upcoming negotiations. of a peace agreement.
Investors are awaiting announcements on Thursday from the ECB, which is expected to raise its key rates by 25 basis points, without knowing the continuation of its policy for the rest of the year.
In Canada, the BoC, as expected, maintained its main key rate on Wednesday – at the current level and clarified that it saw few signs of a “generalized inflation”, while adding that it was ready to raise its borrowing costs if necessary.
In the United States, inflation, as expected, decelerated in May – over one month to 0.5%, but on an annual basis, it accelerated to 4.2%, the largest increase since April 2023.
For Steve Kolano, director of investments at Integrated Partners, the report on consumer prices in the United States “does nothing to reduce the likelihood of a possible rate hike at some point this year”, given high energy prices and the conflict with Iran.
In this context, oil prices have started to rise again and bond yields in Europe have tightened.
VALUES IN EUROPE
Renault dropped 1.58% despite the automaker’s announcement of a jump in orders for electric cars since the war in Iran. The automobile sector on the Stoxx 600 fell by 1.02%, with the decline in industrial values.
Sanofi fell -1.33% after announcing the end of the phase 3 “MOBILIZE” study of riliprubart, tested in patients with chronic inflammatory demyelinating polyneuropathy (CIDP).
Soitec plunged 10.56%, Jefferies having lowered its recommendation on the group, judging the stock overvalued.
Volvo Group lost 3.73% after revealing its outlook at an investor event.
WH Smith fell by 16.15% after issuing a new warning on its results and announcing a capital increase.
Commerzbank fell by 2.03% after expressing new concerns in the context of the UniCredit offer (-1.35%).
TODAY’S INDICATORS
Producer prices in China increased in May for a third consecutive month, by 3.9% year-on-year after an increase of 2.8% in April, reaching their highest since July 2022, according to official data.
CHANGES
The dollar fell by 0.01% against a basket of reference currencies, thus practically standing still after the publication of American inflation figures.
“Core inflation escaped a widely feared acceleration last month, suggesting that the surge in energy prices is not fueling – for the moment – the core index watched by the Federal Reserve,” explains Karl Schamotta, chief market strategist at Corpay.
The euro gained 0.03%, to 1.1547 dollars, while the pound sterling traded at 1.3386 dollars (+0.07%).
RATE
The yield on ten-year US Treasury bills is stable at 4.530% after having fallen slightly during the session following the publication of data showing that underlying consumer price inflation slowed more than expected last month. However, investors also kept a close eye on the worsening tensions with Iran.
The ten-year German Bund yield ended up 1.2 basis points, at 3.068%, while the two-year rose 2.5 basis points, to 2.704%.
PATROL
The oil market rises on Wednesday, Donald Trump having once again threatened Iran with bombings.
Brent rose by 3.02% to $94.21 per barrel and American light crude (West Texas Intermediate, WTI) by 3.61% to $91.38.
TO BE CONTINUED THURSDAY:
THE SITUATION ON THE MARKETS
(Some data may show a slight lag)
(Written by Claude Chendjou, edited by Sophie Louet)
