(CercleFinance.com) – It’s a cold shower: the US inflation figures take expectations on the wrong foot and the CAC40 goes from 6,394 to 6,286 in 1/2 hour (from +1% to -0.7%) .
This correction puts an end to a series of five upward sessions, same scenario for the Euro-Stoxx50 which dropped 1% to 3.610, the DAX yielded -1% against +1.1% at 2:28 p.m.
The consumer price indicator in the United States (CPI) for August rose by +0.1% instead of -0.1 to -0.2% expected.
The Labor Department reveals that the U.S. consumer price index stood at 8.3% in August compared to the same month last year, an annual rate down from 8.5% in the month previous, but Jefferies anticipated a decline to 8%, in the wake of fuel prices on US soil.
Excluding energy (+23.8%) and food products (+11.4%), two traditionally volatile categories, the annual inflation rate stood at 6.3% last month, a level again higher than that of 6% anticipated by Jefferies and most brokers like Goldman Sachs.
Sequentially, i.e. between July and August 2022, consumer prices in the United States increased by 0.1% in raw data and by 0.6% excluding energy and food products: this denies the hope that the peak of inflation had been exceeded in July.
‘If core inflation were to rise, this would reverse a series of three months of decline and would put a little more pressure on the Fed to toughen its tone at its September 19 meeting’, warns La Financière de l ‘Chessboard.
This morning, the markets had reacted positively to the ZEW index under the principle ‘bad news = good news: the ZEW economic climate barometer for Germany fell by 6.6 points to a value of -61.9 in September, while that of the economic situation fell quite sharply by 12.9 points to currently stand at -60.5.
“The prospect of energy shortages in winter has made expectations even more negative for much of German industry. In addition, growth in China is evaluated less favourably,” explains Achim Wambach, president of the ZEW institute.
For the euro area as a whole, financial market experts’ sentiment regarding economic development fell by 5.8 points to -60.7 and that of the current situation plunged even more sharply, from 16.9 points to -58.9.in investor sentiment in Germany, which could fuel fears about European growth.
The New York Stock Exchange is expected to fall sharply (-1.4% for the Dow Jones, -2% for the S&P500) with -2.5% for the Nasdaq more sensitive to interest rate pressures while the yield of Treasuries to ten years recovers 8 basis points, to 3.442%, flirting with the worst levels of mid-June.
The ‘2 year’ soared by +14Pts beyond 3.70%, the ‘1 year’ by almost +20Pts to 3.86%, annual record pulverized.
The German Bund tightened by +9Pts towards 1.735% (against 1.75% the day before yesterday), our OATs show +8Pts at 2.295%.
The dollar rose strongly (+1.2%), rising from 1.0140 against the euro to 1.0010.
Oil prices continue their yo-yo movement after rising sharply yesterday on rumors of a possible European embargo on Russian petroleum products. The barrel of Brent dropped 1% to 93.2 dollars and light crude -1.2% to 87.1$.
On the stock side, Bouygues Travaux Publics is expanding its offer of infrastructure solutions for offshore wind power, with the exclusive acquisition of the OO-STAR floating base technology, owned by Floating Wind Solutions. This technology makes it possible to adapt to a large number of marine environments, reduce the carbon footprint of wind farm infrastructure and reduce operating and maintenance costs.
Aveva is close to reaching an agreement with Schneider according to Sky News. Schneider could take over Aveva based on a valuation of £9 billion.
According to Sky News, the two groups would discuss buying 40% of Aveva which Schneider does not already own on the basis of a price of more than £30 per share. Schneider already holds 60% of the capital. This amount would value the purchase price of the 40% at around £3.5 billion. This agreement should be concluded before September 21 according to banking sources interviewed by Sky News.
Air Liquide announces the sale of its Industrial Merchant activities in Saudi Arabia to Abdullah Hashim Industrial Gases & Equipment, a joint venture of Air Products for its Industrial Merchant activity in Saudi Arabia. This disposal is insignificant for the entire scope of Air Liquide in the Africa Middle East and India zone.