A trader on the New York Stock Exchange (NYSE)
by Blandine Henault
PARIS (Reuters) – The main European stock markets are expected to fall slightly on Monday at the opening, in a climate of caution and while investors are still digesting a salvo of indicators and company results that have fallen in recent days.
According to the first indications available, the Parisian CAC 40 could lose 0.38% at the opening. Futures contracts are signaling a decline of 0.43% for the Dax in Frankfurt, 0.46% for the FTSE in London and 0.37% for the Stoxx 600.
European stock markets ended on a positive note last week while posting sharp declines over the week as a whole, marked by the publication of numerous company results, very poor manufacturing PMI indicators in the euro zone and a rise in bond yields.
Highly anticipated, the official report on US employment, published on Friday, showed less than expected job creation in July but higher than estimated wage growth, reflecting a still tight labor market.
Even though Treasury yields fell after this publication, it did not confirm to investors the scenario of a pause by the Federal Reserve in raising its rates at its next monetary policy meeting in september.
VALUES TO FOLLOW:
AT WALL STREET
The New York Stock Exchange ended lower on Friday, after the publication of the employment report and against a backdrop of disappointment with Apple’s results.
The Dow Jones index fell 0.43% to 35,065.62 points. The broader S&P-500 lost 0.53% to 4,478.03 points and the Nasdaq Composite fell 0.36% to 13,909.24 points.
In values, Apple fell more than 4% after warning of a further quarterly decline in sales.
IN ASIA
As the close approached, the Tokyo Stock Exchange erased its losses from the start of the session. The Nikkei advanced 0.15%, having earlier hit a low since July 12.
In China, the CSI 300 and the composite index of the Shanghai Stock Exchange lost 0.56% and 0.75% respectively, as investors continued to be disappointed with Beijing’s lack of major support for the economy.
RATE
US bond yields are moving on a stable or slightly bullish note after their sharp decline on Friday.
The ten-year Treasuries rate was almost unchanged at 4.0581% after falling nearly 13 basis points on Friday, its biggest daily drop since July 12.
That of two-year government bonds regained two basis points, to 4.812%, after a decline of 11 basis points on Friday which brought it to a two-week low.
“Yields could be the main driver of the markets this week as the United States issues $103 billion in debt at multiple maturities, following Fitch’s credit rating downgrade last week,” Michael said. Hewson, head of market analysis at CMC Markets UK.
CHANGES
The dollar was unchanged against a basket of benchmark currencies as the US jobs report failed to give traders a clear direction.
The latter will monitor the publication on Thursday of consumer prices in the United States with a “core” index expected to slow to 4.7% on an annual basis in July after 4.8% the previous month.
The euro fell 0.2% against the greenback, to 1.0993.
OIL
Crude prices are down slightly but remain close to their peaks of mid-April, supported by production cuts undertaken by Saudi Arabia and Russia, the world’s two main oil producers.
The barrel of Brent from the North Sea fell 0.1% to 86.16 dollars and that of American light crude (WTI) also dropped 0.1% to 82.74 dollars.
MAIN ECONOMIC INDICATORS ON THE AGENDA FOR AUGUST 7:
COUNTRY GMT INDICATOR PERIOD PREVIOUS CONSENSUS
FROM 06:00 Industrial production June -0.5% -0.2%
(Written by Bandine Hénault, edited by)