(ABM FN) The Brussels stock market is preparing for a slightly higher opening on Monday after an agreement in principle on the US debt ceiling. Futures on the Euro Stoxx 50 index are fractionally in the green about an hour before the stock market call. Wall Street will be closed today for Memorial Day and traders in London are also free today.
The Bel20 rose 0.7 percent on Friday to 3,652.16 points. On a weekly basis, the star index fell 2.2 percent. Wall Street closed convincingly in the green on Friday.
Investors were led by optimism on Friday about an increase in the US debt ceiling. US President Joe Biden and House Speaker Kevin McCarthy subsequently announced an agreement in principle on Saturday night on an increase in the ceiling for the next two years, until after the presidential election.
To get the Republicans to do so, Biden had to promise to implement budget cuts.
Not all details are clear yet and McCarthy said “there’s still a lot of work to be done”. Some Republicans have already reacted with disappointment and believe that McCarthy gave too much away and negotiated too little during the negotiations.
Biden said neither side has fully gotten what it wanted, and everyone has had to compromise.
The current debt ceiling stands at $31,400 billion and it is likely that without a deal the US would be unable to meet its obligations sometime in early June. Minister Janet Yellen has warned about this several times in recent weeks.
Incidentally, the deal on raising the debt ceiling still needs to be approved by the Senate and the House of Representatives. And that’s not a race yet.
Biden called for the deal to be approved in order to avoid “a catastrophic default” that would trigger an economic recession.
In Asia, the main indices are mainly in the green this morning, with the Japanese Nikkei index even recording a gain of around one percent at its highest level since 1990. The Hang Seng index in Hong Kong, on the other hand, is the dissonant with a loss of several tenths of a percent and the index is at its lowest level this year.
In the current year, the return for the Hang Seng index is now 5.5 percent negative, while the Nikkei index has risen by almost 20 percent.
Due to the positive sentiment surrounding the debt deal, the US oil futures climbed almost one percent this morning to $ 73.33 a barrel.
The Turkish lira, on the other hand, hit its lowest level ever this morning following the re-election of President Recep Tayyip Erdogan.
Investors have little confidence in Erdogan’s economic policy, which has long been exerting pressure on the Turkish central bank to continue cutting interest rates despite high inflation.
Western central banks are currently implementing interest rate hikes to cool inflation.
This morning the lira was at its lowest level ever and 1 dollar is worth about 20 lira. At the beginning of 2022, that conversion ratio was still around 13.
Due to Memorial Day, the macroeconomic calendar is virtually empty today.
Company news
KBC Ancora decided on an interim dividend of EUR 3.31 per share. The share is quoted ex-dividend on June 6. No final dividend will be paid.
Retail Estates saw an improvement in EPRA earnings in the past financial year 2022/2023 and increased the dividend. The EPRA earnings amounted to 6.34 euros per share, or 9 percent more than a year earlier.
Mithra Pharmaceuticals appointed Christian Homsy, former CEO and co-founder of Celyad, as chairman.
Wall Street closing positions
The S&P 500 rose 1.3 percent on Friday at 4,205.45 points, the Dow Jones index gained 1.0 percent at 33,093.34 points and the Nasdaq closed 2.2 percent higher at 12,975.69 points.
Bron: ABM Financial News
The editors of follow from Beursplein 5 ABM Financial News developments on the stock exchanges, and the Amsterdam stock exchange in particular, closely. The information in this column is not intended as professional investment advice or as a recommendation to make certain investments.
2023-05-29 06:06:00
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