(Global) Global stock markets moved in mixed order on Thursday, held back by mixed macroeconomic indicators and a tight bond market due to comments from members of the US Central Bank that did not suggest a change of gear on rate hikes anytime soon. .
European stock markets closed in mixed order after spending a day on the downside. Frankfurt finished in the green at +0.23%, but Paris lost 0.47% and London 0.06%.
St. Louis, Missouri Fed President James Bullard spoke out Thursday in a speech doubting that interest rate hikes so far have gotten them into “a sufficiently tight zone.”
Mary Daly of the San Francisco Fed, meanwhile, warned that a hike in overnight rates of another full percentage point will likely be needed, as they currently sit between 3.75% and 4%, also clearly ruling out a pause in rate hikes for now.
“As many signals indicating that the pivot of the Fed could wait”, commented Grégory Bailly, expert in financial investments of Milleis Banque.
In the bond market, yields on 10-year Treasury bills climbed to 3.77% as of 5 p.m. from 3.69% the day before, which depressed traders.
Macroeconomic news was particularly rich and set the markets in motion: in the United States, construction of new homes in October fell by 4.2% and building permit applications were also down by 2.4%. What rule out an improvement in the market in the immediate future, while the rise in mortgages, in the wake of that of Fed rates, scares buyers.
In Europe, the publication of the British budget “in a context where inflation is at its highest since 1981” did not help to reassure investors, believes Grégory Bailly.
The United Kingdom has now entered “a recession” and its gross domestic product (GDP) will fall by 1.4% in 2023, announced the British Minister for Finance Jeremy Hunt, at the same time as 55 billion pounds (87 billion CAN dollars) of spending cuts and tax increases.
energy roller coaster
“The best performing stocks were, somewhat counterintuitively, SSE (1.52%) and Centrica (5.43%) in London, despite the announcement of a 45% ‘profits’ levy surpluses” of low-carbon energy producers from 1er January, applied to profits exceeding 75 pence per MWh,” explained CMC Markets analyst Michael Hewson.
In Paris, however, TotalEnergies lost 1.39% and Engie 0.10%. In Milan, Italian oil and gas giant Eni fell 2.05%, but in Madrid Iberdrola managed to climb 0.10% at the close after being down.
Burberry on the catwalk
The British luxury group Burberry gained 2% at the close of the London market, after the publication of significantly higher results for its staggered first half, thanks to the post-pandemic recovery in Europe and despite the difficulties linked to the COVID- 19 in China.
In the wake of the Briton’s results, French luxury stocks rose: Kering gained 0.45% and Hermès 0.76. LVMH, on the other hand, ended down 0.26%.
On the side of currencies and oil
The price per barrel of West Texas Intermediate (WTI), the American benchmark variety, fell by almost 5% to its lowest level in a month and a half, in a market increasingly concerned about the weakening of Requirement.
A barrel of WTI for December delivery fell 4.61% to close at $81.64, its lowest closing level since late September.
The barrel of Brent from the North Sea, with maturity in January, dropped 3.31% and ended at 89.78 dollars, below 90 dollars for the first time since the beginning of October.
The euro fell 0.27% against the US dollar, to 1.0367 dollar.