EUROPEAN SCHOLARSHIPS END IN FALL
PARIS (Reuters) – European stock markets ended in decline on Monday, the closure of the British and American markets due to public holidays prompting investors to favor caution for the last session in May remained buoyant for equities despite concerns about inflation.
In Paris, the CAC 40 lost at the close 0.57% (36.94 points) to 6,447.17 points after rising to 6,496.32 and in Frankfurt, the Dax dropped 0.64%.
The EuroStoxx 50 index ended down 0.76%, the FTSEurofirst 300 0.52% and the Stoxx 600 0.49%.
The long weekend for the London and New York stock exchanges weighed on volumes: on the Stoxx 600, they barely exceeded 20% of their 30-day average, according to Refinitiv data.
May ended with a fourth consecutive positive monthly performance for the Stoxx 600 (+ 2.14%), which posted a record Friday, as for the CAC 40% (+ 2.83%), at most high since September 2000, a sign that the efforts undertaken by the major central banks to allay fears of a lasting rise in inflation damaging to equities have borne fruit.
Also on Monday, Ignazio Visco, a member of the Governing Council of the European Central Bank (ECB), assured that the latter would react in the event of an unjustified rise in market rates.
But the positive impact of his remarks was obscured by the first estimate of inflation in Germany in May: at 2.4% year-on-year, it is indeed moving away from the ECB’s target of a rate slightly below 2%.
The first estimate for the euro zone will be released on Tuesday, following the final results of Markit’s manufacturing PMI surveys, but the highlight of the week will be the release of US employment figures on Friday, which could influence the next decisions of the Federal Reserve.
“The spare capacity of the workforce is for the moment prompting the Fed to restrain. This is changing and the FOMC’s monetary policy statement in June could reflect this improvement,” stressed the economists of the Societe Generale.
The transport and leisure compartment (+ 0.33%) posted the only sector increase of the day; in contrast, that of utilities lost 1.15%, weighed down among others by the Spanish groups Endesa (-5.37%) and Iberdrola (-2.48%) after an article in daily El Pais according to which the government wants to lower household electricity bills.
In the banking sector, Deutsche Bank lost 1.26% in response to information from the Wall Street Journal according to which the US Federal Reserve considers the group’s anti-money laundering efforts insufficient, which implies a risk of sanctions.
The dollar continued to decline against other major currencies (-0.20%), allowing the euro to climb back to 1.2228 late in the session after falling below 1.22 in the morning.
The “dollar index” shows over the whole of May a decline of 1.57%, after -2.1% in April.
The Chinese yuan posted a three-year high against the dollar, but then lost ground with the announcement by the People’s Bank of China of raising financial institutions’ foreign exchange reserves.
German inflation figures were not enough to stem the decline in benchmark eurozone yields that began mid-morning after the news of slower growth in credit to the private sector in April was announced to 3, 2% after 5.3% in March.
That of the ten-year German Bund ended the day at -0.184% after peaking at -0.15% and its French equivalent fell to 0.174%.
The oil market continues to benefit from the prospects for improving demand without worrying about the possible fallout from the OPEC + meeting on Tuesday.
Brent gained 1.09% to $ 69.47 per barrel and US light crude (West Texas Intermediate, WTI) 1% to $ 66.98. They took 3.2% and 4.3% respectively over the month of May.
OPEC and its allies should confirm Tuesday’s desire to very gradually increase their production in the coming months to take into account both the recovery in demand and a possible return of Iranian crude to the international market.
TO WATCH ON TUESDAY:
THE SITUATION ON THE MARKETS:
(Some data may show a slight lag)
THE CLOSURE IN
Indices Last Var. Where. % YTD
Eurofirst 300 1,719.24 -8.99 -0.52% + 11.89%
Eurostoxx 50 4039,46 -31,10 -0,76% +13,70%
CAC 40 6447.17 -36.94 -0.57% +16.14%
Dax 30 15421,13 -98,85 -0,64% +12,41%
FTSE 7022.61 +2.94 + 0.04% + 8.70%
SMI 11 363.45 -62.70 -0.55% + 6.17%
The values to follow in Paris and in
Europe : [WATCH/LFR]
Price Watch Var.% YTD
Euro/Dlr 1,2228 1,2189 +0,32% +0,12%
Dlr/Yen 109,46 109,81 -0,32% +6,10%
Euro/Yen 133,87 133,92 -0,04% +5,48%
Dlr/CHF 0,8983 0,8997 -0,16% +1,49%
Euro/CHF 1,0989 1,0968 +0,19% +1,68%
Stg/Dlr 1,4209 1,4187 +0,16% +3,92%
Index $ 89.8370 90.0310 -0.22% -6.59%
Veille Var course. % YTD
Or Spot 1904,90 1902,64 +0,12% +25,57%
Last Var. Spread / Bund
Future Bund 169,99 +0,05
Bund 10 ans -0.18 -0.00
Bund 2 ans -0.66 +0.00
10-year OAT 0.17 -0.00 +35.60
Previous Price Var Var.% YTD
US light gross 66.94 66.32 + 0.62 + 0.93% + 9.36%
Brent 69,42 68,72 +0,70 +1,02% +5,13%