OF Morning Bulletin

European stock markets are expected to fall after Lael Brainard's restrictive remarks. The Eurostoxx 50 opens at 3,917.85 points (-0.84%), the CAC 40 at 6,645.51 points (-1.28%), the DAX 40 at 14,424.36 points (-0.65% ), the FTSE 100 at 7,613.72 points (+0.72%), the SMI at 12,376.97 points (+0.29%), the AEX at 736.02 points (-0.24%), the BEL 20 at 4,242.80 points (+0.37%), IBEX 35 at 8,623.30 points (+1.20%), DJIA at 34,641.18 points (-0.80%), Nasdaq at 14,204.17 points (-2.26%), the S&P 500 at 4,525.12 points (-1.26%) and the Nikkei 225 at 27,354.85 points (-1.56%).

Regarding the exchange rate, the variation from the close in New York indicates that EUR/USD opens at 1.0899 (-0.06%), EUR/JPY at 134.93 (+0.11%) and USD/JPY at 123.82 (+0.18%).

The capital increase will be followed by an asset disposal plan, for an amount of approximately 3 billion euros, between 2022 and 2024. For its part, Saint-Gobain announced the disposal of Tadmar, its distribution of plumbing and heating items in Poland, to the Polish company 3W. Tadmar generated in 2021 a turnover of around 100 million euros. This disposal will mark the exit of Saint-Gobain from the distribution activity in Poland.

European equity markets are set to open lower on Wednesday, on the heels of a pullback on Wall Street which accelerated on Tuesday after US Federal Reserve (Fed) Governor Lael Brainard spoke out for a rapid reduction in the balance sheet of the central bank. At 7:30 a.m., the CAC 40 futures contract lost 15 points, or 0.2%, according to data from broker IG Markets. The DAX 40 contract lost 39 points, or 0.3%, and the FTSE 100 contract lost 3 points, or 0.04%.

After these remarks and in a still tense geopolitical context following the announcement of new American sanctions against Russia, Wall Street closed lower on Tuesday. The Dow Jones Index (DJIA) lost 0.8% to 34,641.18 points, and the broader S&P 500 index ended down 1.3% to 4,525.12 points. The Nasdaq Composite fell 2.3% to 14,204.17 points. In Asia, the main markets fell on Wednesday. In Tokyo, the Nikkei index lost 1.5% at the end of the session. The Hong Kong Stock Exchange's Hang Seng index dropped 1.6% and the Shanghai Composite lost 0.2%.

Yields on two-year and ten-year U.S. Treasury bonds jumped Tuesday to their highest levels since March and April 2019, respectively, after Lael Brainard said he expected the Fed to cut its balance sheet by nearly 9,000 billions of dollars much faster than during the last phase of the economic rebound. The ten-year Treasury bond rate rose Wednesday morning to 2.628%, against 2.554% Tuesday evening. The two-way bond rate rises to 2.588% from 2.530% on Tuesday night.

The dollar appreciated against the euro on Wednesday, buoyed by restrictive comments from Lael Brainard. However, the single currency is expected to rally strongly if the war in Ukraine ends, as the European Central Bank (ECB) is expected to start raising interest rates and fiscal stimulus measures are expected to intensify across the European Union, says Saxo Bank. The ECB could end its negative interest rate policy by the end of the year if the war in Ukraine ends, estimates Saxo Bank. Meanwhile, Germany has pledged massive fiscal spending to meet its energy and defense obligations, while the EU will fund new fiscal initiatives through joint debt issuance, according to the bank. Danish investment.

Oil futures were little changed on Wednesday morning, after falling overnight on dollar strength prompted by restrictive comments from Lael Brainard, ANZ said. Black gold prices remain supported by the prospect of new sanctions targeting Russian exports, the bank adds. By 7:20 a.m., the June Brent contract was up 15 cents to $106.79 a barrel, while the May contract for Nymex-listed light sweet crude (WTI) was down 15 cents to $101.80 a barrel. .