EUROPEAN STOCK EXCHANGES ENDED WITHOUT MAJOR CHANGES ON MONDAY
by Laetitia Volga
PARIS (Reuters) – European stock markets closed flat on Monday, the return of concerns about the Chinese economy weighing on investors’ appetite for risky assets as well as oil prices.
After a yo-yo session, the Paris CAC 40 gained 0.25% to 6,569.95 points. The British Footsie gained 0.11% and the German Dax 0.15%.
The EuroStoxx 50 index ended 0.34%, the FTSEurofirst 300 0.31% and the Stoxx 600 0.34%.
At the close in Europe, all three major Wall Street indices were erasing their losses to move around breakeven.
Global markets are held back by a series of Chinese data that showed economic activity slowed last month, underscoring the scale of the economic challenge facing authorities in Beijing and prompting the People’s Bank of China to significantly cut two of your main key rates unexpectedly.
For Nomura analysts, this support could be “too weak, too late and ineffective.”
“We believe that China’s growth in the second half will be significantly hampered by its zero COVID strategy, a deteriorating real estate sector and a likely slowdown in export growth,” they said in a note.
For investors, one of the main economic events of the week will be the release of US retail sales on Wednesday and the minutes of the latest meeting of the Federal Reserve.
As earnings season draws to a close, they’ll also be tracking quarterly releases from some of the biggest U.S. retailers, including Walmart on Tuesday and Target on Wednesday.
Oil prices fell sharply as signs of an economic slowdown in China fueled recession fears.
Brent lost 3.95% to $94.27 a barrel and US light crude (West Texas Intermediate, WTI) lost 4.02% to $88.39.
The market is also expecting Iran’s response to the European Union’s proposal to relaunch talks to salvage the 2015 nuclear deal by midnight, which could boost global supply.
Given the concern about the growth of the Chinese economy, the raw materials sector (-1.62%) registered the largest drop of the day, ahead of the oil sector (-1.31%).
CAC 40 red lantern, TotalEnergies down 2.35%. ArcelorMittal lost 1.31%. In London, Shell and Rio Tinto lost 1.49% and 2.24% respectively.
Upward, HelloFresh gained 2.66% after confirming its medium-term targets and saying it was “cautiously optimistic” for the second half and Henkel gained 0.52% after raising its annual business revenue growth target. .
The pharmaceutical group AstraZeneca advanced 2.33% after announcing that a trial confirmed the benefit of the drug Enhertu, developed with the Japanese Daiichi Sankyo, in patients with an advanced form of breast cancer and previously treated with another treatment.
THE INDICATORS OF THE DAY
In the United States, the NAHB/Wells Fargo index, which measures the sentiment of real estate developers, fell to 49 in August, its lowest level since the health crisis, due to the increase in construction costs and mortgage rates.
Manufacturing activity in the New York area deteriorated sharply this month to fall into contraction territory, at -31.3.
In the forex market, weaker-than-expected economic indicators benefited the dollar, which was up 0.59% against a basket of benchmark currencies.
The euro fell to $1.0187, close to a one-week low hit earlier at $1.0179.
Euro zone government bond yields fell as investors worried about a possible recession after the Chinese data and amid fears for the German economy in the event of gas rationing this winter.
The 10-year Bund yield fell nine basis points to 0.903%.
Its US equivalent falls more than seven points to 2.777%.
(Written by Laetitia Volga, edited by Camille Raynaud)
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