Stocks and rates fall on fears about the global economy – 05/12/2022 at 14:11


STOCK AND RATES FALL DUE TO WORLD ECONOMY FEARS

PARIS (Reuters) – Wall Street was expected to fall at the open and European stocks tumbled mid-session on Thursday as investors fear that the Fed’s monetary tightening in the face of inflation will help slow the economy. New York contracts are down 0.11% for the Dow Jones, 0.59% for the Standard & Poor’s-500 and 1.05% for the Nasdaq.

In Paris, the CAC 40 lost 2.24% to 6,129.27 around 1135 GMT. In Frankfurt, the Dax fell 1.92% and in London the FTSE shed 1.93%.

The pan-European FTSEurofirst 300 fell 1.6%, the Eurozone EuroStoxx 50 fell 2.17% and the Stoxx 600 fell 1.78%. returns on stocks and bonds.

“Markets fear that central banks trying to tame inflation could trigger a recession, or at least a sharp economic downturn. When you look at consumer price data, it may be too early to announce a peak in inflation,” Luke said. Philip from SYZ Private Banking.

The release of US producer prices at 1230 GMT should spark debate over the Fed’s rate.

INDICATOR

Government bond yields plummeted, with the 10-year German bond shedding 14.1 basis points to 0.86% and its French equivalent more than 25 basis points to 1.39%, both at their lowest levels since April 29.

In the United States, US inflation statistics also highlight the flattening of the Treasury yield curve, with the spread between 2- and 10-year yields falling below 10 basis points in the session on Wednesday, the lowest level in almost the entire session. two weeks. Now it shows around 24.63.

Ten-year Treasuries yielded 2.8299% versus 2.9246% at the close on Wednesday.

WALL STREET VALUES TO FOLLOW

Growth stocks should again put pressure on the US session, in particular the Nasdaq Composite, which has already fallen more than 3% on Wednesday.

In gas station trading, shares of Meta, Microsoft, Alphabet, Apple, Amazon and Tesla fell 1% to 2.1%.

Apple shares fell 5.2% on the eve, giving way to the world’s first in market capitalization in favor of Saudi Aramco. The oil giant, which has benefited from rising oil prices, has a capitalization of about $2.426 billion, while Apple has a capitalization of $2.371 billion.

VALUES IN EUROPE

In the stock market, all European sectors are in the red, and the biggest falls are in basic resources (4.27%) and automotive (2.64%).

In Paris, luxury heavyweights Kering, LVMH and Hermès lost 4.14% to 4.63%.

Shares of Tod’s fell 5.83% after the Italian luxury footwear group announced that containment measures in China weighed on its results in March.

In Frankfurt, shares of Commerzbank, Siemens and Heidelbergcement fell from 2.9% to 5.12% after the publication of their results. Semiconductor maker STMicroelectronics stands out up (+3.14%) after saying it aims for annual sales of over $20 billion (€19.04 billion) no later than 2027 thanks to continued strong demand from the automotive and industrial sectors and smartphone manufacturers.

CHANGES

Thanks to its safe-haven status, the dollar index, which measures the swing of the US currency against the base basket, rose 0.63%, its highest in nearly 20 years.

The euro fell about 1% to $1.0411, its lowest level since January 2017.

The pound hit a two-year low against the US dollar after announcing weaker-than-expected growth in the UK economy in the first quarter and an unexpected contraction only in March.

The overall climate is also unfavorable for cryptocurrencies, starting with bitcoin falling to $25,401.05 for the first time since late 2020.

BUTTER

Oil prices are falling, again due to economic and recession fears.

Brent lost 1.05% to $106.38 a barrel, while US light oil (West Texas Intermediate, WTI) fell 0.92% to $104.74.

(Written by Letitia Volga, edited by Kate Entringer)

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