European equity markets are expected to rise as all eyes turn to US inflation. The Eurostoxx 50 opens at 4,129.25 points (+0.21%), the CAC 40 at 7,028.41 points (+0.27%), DAX 40 at 15,242.38 points (+0.24%) , the FTSE 100 at 7,567.07 points (-0.08%), the SMI at 12,155.66 points (-0.31%), the AEX at 755.79 points (+0.01%), the BEL 20 to 4,060.20 points (+0.52%), the IBEX 35 to 8,674.60 points (+1.36%), the DJIA to 35,462.78 points (+1.06%), the Nasdaq to 14,194 .45 points (+1.28%), the S&P 500 at 4,521.54 points (+0.84%) and the Nikkei 225 at 27,579.87 points (+1.08%).
With regard to the exchange rate, the variation compared to the closing in New York, EUR/USD at 1.1427 (+0.08%), EUR/JPY at 131.95 (+0, 02%) and USD/JPY at 115.48 (+0.06%).
After a 7% rebound in 2021, France's gross domestic product (GDP) should experience more moderate growth momentum over the coming months, the National Institute for Statistics and Economic Studies (Insee) said in its latest economic update, published on Tuesday evening. GDP should grow by 0.3% in the first quarter and then by 0.6% in the second, predicts INSEE, which last December forecast growth of 0.4% and 0.5% respectively for these two periods. At mid-year, the growth overhang for 2022 should thus amount to 3.2%, against 3% previously expected.
European equity markets are expected to open in the green on Wednesday, as Wall Street and Asian stocks rose overnight. Around 7:40 a.m., the CAC 40 futures contract gained 63 points, or 0.9%, according to data from broker IG Markets. The contract on the DAX 40 gained 130 points, or 0.9%, and that on the FTSE 100 rose by 67 points, or 0.9% as well.
Wall Street ended up, encouraged by good quarterly corporate results in a context of rising bond rates. The Dow Jones index (DJIA) rose 1.1% to 35,462.78 points. The broader S&P 500 index gained 0.8% to 4,521.54 points, and the Nasdaq Composite gained 1.3% to 14,194.46 points. However, the session was still choppy, with the Fed's monetary tightening plans keeping the bond markets under tension. The yield on the ten-year US Treasury bond thus approached the 2% mark on Tuesday. In Asia, the markets are moving firmly in the green on Wednesday, supported by the gains on Wall Street. The Nikkei index closed up 1.1% in Tokyo. At the end of the session, the Hang Seng of the Hong Kong Stock Exchange took 2% and the Shanghai Composite gained 0.8%.
Yields on US Treasury bonds remain close Wednesday morning to the multi-year highs reached the day before. The ten-year Treasury bill rate, the market benchmark, notably rose to 1.98% on Tuesday, a level not seen since July 2019, and some analysts believe it could soon to reach 2%. Around 7:40 a.m., it stood at 1.944%. Yields have been rising for several months, with markets pricing nearly a 33% chance that the Federal Reserve (Fed) will raise interest rates by 50 basis points in March.
The euro rose slightly against the dollar on Wednesday, while operators await the publication, scheduled for Thursday, of the consumer price index in the United States. The euro could register limited gains, as the ECB has hinted that it could raise interest rates earlier than previously envisaged, Rabobank said. The ECB's tighter stance is supportive of the euro, but the pace of rate hikes will be slower than the Fed's this year, predicts Jane Foley, currency strategist at Rabobank. The market is also pricing in too much ECB policy tightening over the coming year, she added.
Oil prices changed little Wednesday morning. At 7:30 a.m., the April contract on Brent North Sea crude was up 2 cents, at $90.80 a barrel. The Nymex-listed light sweet crude (WTI) March contract was unchanged at $89.36 a barrel. Operators are watching data on crude stocks in the United States, tensions between Russia and Ukraine and the prospect of a nuclear deal between the United States and Iran.