Stock market: what is moving in the markets before the opening on Thursday
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MARKET REVIEWS. Stock markets reacted negatively Thursday to the monetary policy outlook of the major central banks on both sides of the Atlantic for next year which raised fears for growth.
Stock market indices at 8:15 a.m.
The futures contracts Dow Jones posted a decline of 255.00 points (-0.75%) to 33,738.00 points. The futures contracts S&P500 posted a decline of 38.00 points (-0.95%) to 3,960.00 points. The futures contracts Nasdaq fell by 135.50 points (-1.15%) to 11,615.25 points.
In London, the FTSE100 dropped 27.77 points (-0.37%) to 7,468.16 points. In Paris, the CAC 40 dropped 80.14 points (-1.19%) to 6,650.65 points. In Frankfurt, the DAX fell 164.09 points (-1.13%) to 14,296.11 points.
In Asia, the Nikkei of Tokyo closed down 104.51 points (-0.37%) at 28,051.70 points. For his part, the Hang Seng Hong Kong closed down 304.86 points (-1.55%) at 19,368.59 points.
On the oil side, the price per barrel of American WTI fetched US$0.17 (+0.22%) to US$77.45. The barrel of North Sea Brent earned US$0.12 (+0.15%) to US$82.82.
The context
The Fed reduced the pace of its monetary tightening on Wednesday by raising its main interest rate by half a percentage point as planned, after having raised it by three quarters of a point the four previous times, to control the highest inflation in the United States for 40 years.
But it has confirmed that it will continue to raise rates to tame inflation and now expects its main key interest rate to exceed 5% next year, a higher level than previously indicated.
The institution was more pessimistic about the evolution of the rise in prices next year, on unemployment and on the growth of the world’s largest economy.
“The central bank’s message is clear: inflation remains a problem and the job is far from over,” summarize the experts at Aurel BGC.
In line with the Federal Reserve, other central banks have decided to continue to prioritize the fight against inflation.
The Bank of England (BoE) also raised its key rate by 0.5 percentage point and considered that “further increases may be necessary”.
It should be followed by the European Central Bank which will publish its decision at 8:15 am.
The Swiss Central Bank also felt that it was “too early to lower our guard” by raising its key rate by half a point. The Bank of Norway, for its part, raised its rate by 0.25 points to 2.75%, and hinted at further monetary tightening in the first quarter of 2023.
The evolution of monetary policies is all the more worrying as investors fear that high interest rates will push the global economy into recession.
These fears manifest themselves through a marked inversion of the yield curve between short-term and long-term bonds.
The plunge in household consumption in China in November penalized luxury stocks: Kering fell by 4.38%, Hermes by 2.44% and LVMH 2.20% in Paris. Elsewhere in Europe, Moncler fell by 1.98%, Richemont 2.29% and Burberry of 1.30%.
Technology stocks were hurt by the confirmation of prolonged monetary tightening by the Fed. In Tokyo, for example, Sony fell by 0.94% and the industrial automation group Keyence dropped 1.82%. In Paris, Worldline fell by 4.47%, STMicroelectronics 2.65%, Dassault Systems by 1.54%. In Frankfurt, Delivery Hero lost more than 3%.
You’re here yielded 1.09% in electronic trading before market. Elon Musk sold, earlier this week, for about $ 3.6 billion in additional shares of Tesla, of which he is the boss, according to a document published Wednesday by the American regulator of the markets, the SEC.
The dollar rose Thursday against the pound and the euro the day after the decision of the American Federal Reserve (Fed) to raise its rates by 50 basis points.
The greenback took 0.76% against the European currency which traded at 1.0623 dollars. The dollar rose 0.76% against the British currency, to 1.2330 dollars for one pound.
