(ABM FN-Dow Jones) The European stock markets are heading for a higher opening on Tuesday, but the results seem limited.
With the deal to raise the US debt ceiling pending congressional approval, investors are taking a wait-and-see attitude, according to analysts at JPMorgan Asset Management.
“There’s still work to be done, and hard-line Republicans can vote against it, so while we’re on track, we’re not there yet.”
IG forecasts an opening gain of 9 points for the German DAX and a modest minus of 2 points for the French CAC 40 for Tuesday. The British FTSE looks set to open 6 points higher.
Equity markets in Europe ended slightly lower on Monday. The UK FTSE was closed for a bank holiday. It was a quiet trading day with low volumes as Wall Street was also not trading due to Memorial Day.
The US stock markets can only respond on Tuesday to a preliminary agreement to raise the US debt ceiling. There may also be a stronger reaction in the European markets.
“Investors will probably wait for the deal [over het verhogen van het schuldplafond] approved by Congress before they will increase their risk exposure,” UniCredit analysts said.
Monday was also quiet on a macroeconomic level. Inflation figures from the eurozone are due later this week.
The Turkish lira was trading near an all-time low on Monday 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. The stock market in Istanbul rose around 4 percent.
Company news
There were no major price outliers on Monday. In Paris, Unibail-Rodamco-Westfield won around more than one percent. Worldline lost more than 2.5 percent.
In Frankfurt, Sartorius was more than one percent higher and Continental lost more than 2 percent.
The fall in Borussia Dortmund’s share was striking, which plummeted 27 percent after the football club lost the national title to Bayern Munich last weekend.
Euro STOXX 50 4.319,52 (-0,4%)
STOXX Europe 600 460,87 (-0,1%)
DAX 15.952,73 (-0,2%)
CAC 40 7.303,81 (-0,2%)
FTSE 100 7,627.20 (+0.7% – closing Friday)
SMI 11,434.24 (+1.0% – closing Friday)
AEX 764.10 (-0.5%)
BEL 20 3.641,37 (-0,3%)
FTSE MIB 26.617,35 (-0,4%)
IBEX 35 9.180,10 (-0,1%)
AMERICAN SHARES
On Tuesday, the US stock markets will face a red opening.
Wall Street was closed Monday for Memorial Day. The indices in New York closed even higher on Friday.
Last weekend, a preliminary agreement was reached in America between President Joe Biden and House Speaker Kevin McCarthy on an increase in the debt ceiling.
The agreement still has to be approved by the US Congress and that is far from a race. According to Biden, both the Democrats and the Republicans have added water to reach an agreement and it is therefore a fair deal. But there are critical voices from both camps.
“There is always a chance, however small, that hardline Republicans could undermine McCarthy’s efforts,” SPI Asset Management said.
On a macroeconomic level, the US job data will be the most eye-catching later this week. On Wednesday, the jobs report from pay slip processor ADP for the month of May and data on the open vacancies in the US in April will follow. The weekly aid applications will be published on Thursday and the official jobs report on Friday.
Job data is important to the Federal Reserve’s interest rate policy, as are inflation data. On Friday it was announced that PCE inflation in the US increased in April. That’s why a clear 66 percent majority of the market is now counting on another 25 basis point rate hike by the Fed in June. Previously, a pause was assumed.
S&P 500 index 4,205.45 (+1.3% – closing Friday)
Dow Jones index 33,093.34 (+1.0% – closing Friday)
Nasdaq Composite 12,975.69 (+2.2% – closing Friday)
ASIA
The Asian stock markets showed a mixed picture on Tuesday.
Nikkei 225 31.329,98 (+0,3%)
Shanghai Composite 3.198,58 (-0,7%)
Hang Seng 18.369,93 (-1,0%)
VALUE
The euro/dollar was trading at 1.0705 this morning. On Monday night, the currency pair was trading at 1.0710.
USD/JPY Yen 140,33
EUR/USD Euro 1,0705
EUR/JPY Yen 150,21
MACRO-AGENDA:
06:30 Producer prices – April (NL)
06:30 Producer Confidence – May (NL)
09:00 Inflation – May (Spa)
11:00 Consumer Confidence – May def. (EUR)
15:00 Case Shiller home prices – March (US)
4:00 PM Consumer Confidence CB – May (US)
COMPANY NEWS:
22:00 Hewlett Packard – US Second Quarter Figures
22:00 HP Inc – Second Quarter (US) Figures
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.
2023-05-30 05:08:00
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