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Europe ends in the green, yields fall

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Europe ends in the green, yields fall
Written by madishthestylebar

The chart of the DAX German stock price index is pictured at the Frankfurt Stock Exchange

by Laetitia Volga

PARIS (Reuters) – European stock markets opened on Monday for the first session of 2023 ended higher, boosted by monthly surveys of purchasing managers which show an improvement in manufacturing activity in the euro zone.

The exchanges were nevertheless sparse, with many stock markets being closed, such as London, New York or Tokyo.

In Paris, the CAC 40 gained 1.87% to 6,594.57 points and the German Dax gained 1.05%.

The EuroStoxx 50 index advanced by 1.65% and the Stoxx 600 by 0.96%.

The S&P Global survey for December suggests that the deterioration in Eurozone manufacturing activity has bottomed out as supply chains recover and inflation eases.

Despite a favorable start to the year, many market participants nevertheless say they are cautious for 2023 as central banks will continue their efforts in the face of rising prices and uncertainties about the evolution of the COVID-19 epidemic. in China persist.

“The year 2022 has been exceptional in many ways with the war in Europe, runaway inflation, the energy crisis and the sharp rate hikes,” said Swedish bank SEB. “As for 2023, it’s hard to be overly optimistic because most of these issues remain.”

VALUES

The automotive sector (+3.19%) posted the best sector performance in Europe, boosted by encouraging PMI indices for industry.

In Paris, Renault climbed 6.79%, Stellantis 2.83% and Faurecia 8.49%.

After a 75% plunge in 2022, Atos started the year 2023 on a better note with a jump of more than 20.01%, driven by information from the daily Les Échos according to which Airbus (+2.56%) is considering a minority stake in the capital of Evidian, the digital and cybersecurity business branch that the IT services group intends to split.

RATE

Yields on eurozone government bonds fell sharply as investors hoped for a continued slowdown in inflation.

They will take note Tuesday at 13:00 GMT of the consumer price index in Germany for the month of December, then that for the whole of the euro zone on Friday.

The ten-year German Bund yield, which hit a 2011 high of 2.57% on Friday, fell more than 11 basis points to 2.447%. The OAT of the same maturity ended below 3%.

CHANGES

On the foreign exchange market, the dollar recovered 0.3% against a basket of six international currencies, moving away from the low of six months reached during the previous session.

The euro fell below 1.07, down 0.45%.

(Laetitia Volga, edited by Sophie Louet)

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