European markets rise calmly before the ECB

Around 1:10 p.m., Paris gained 0.80% while London passed 7,000 points (+ 0.18%). Frankfurt gained 0.95% and Milan 1.24%.

The European stock markets were still progressing Thursday ahead of the decision of the European Central Bank (ECB), which should take a more open tone on inflation, even if its measures to support the economy will likely remain unchanged.

At around 11:10 GMT, the European stock markets reinforced their rebound from the two previous sessions: the Paris Bourse gained 0.80%, going back above 6,500 points while London again rose above 7,000 points (+0, 18%). Frankfurt gained 0.95% and Milan 1.24%.

The New York Stock Exchange, which benefited from good corporate results on Wednesday, was also moving towards a positive opening: the futures contract on the Dow Jones gained 0.23%, that on the S&P 500 took 0.21% and the one on the Nasdaq 0.18%.

Markets were confidently awaiting the ECB’s decision, which will be followed by a press conference by its president, Christine Lagarde, at 12:30 GMT.

The Frankfurt institution should not make any major change to its policy of massive support for the economy, but instead bend its communication around its inflation target.

The markets expect “a very accommodating ECB within the framework of the evolution of its + guidance + (its economic orientations, editor’s note)”, the “new wave of Covid-19” reinforcing this conviction, according to Alexandre Baradez, head of market analysis at IG France.

Two weeks ago, the ECB announced that it was ending its target, unchanged for 18 years, of inflation “below but close to 2%”, in favor of a new target set at 2% on the average. term.

By raising, even marginally, its inflation target, the Frankfurt institution could thus give itself more scope before considering a possible increase in its key rates.

But “the risk for the markets is that they are + positioned + to receive a very accommodating message”, as evidenced by the levels of interest rates and the euro in particular, “therefore any communication a little less flexible than expected would create surprise, ”Judge Baradez again.

In the bond market, the wait-and-see attitude prevailed before the ECB’s verdict: lending rates, which have fallen significantly in recent days, remained broadly unchanged in Europe while the US ten-year borrowing rate continued to recover slightly.

Statistical side, weekly applications for unemployment benefits and home resales for June in the United States are expected in the afternoon.

EssilorLuxottica was not immediately affected (+ 1.08% to 153.56 euros) by the fine of over 125 million euros imposed by the Competition Authority on the Italian Luxottica, the leading supplier world of glasses, for having “imposed” in France, “on opticians, retail prices and for having prohibited them from selling on the internet”.

Daimler towards all-electric

The German manufacturer gained 1.82% to 72.15 euros. The group, which “is preparing” to become fully electric before 2030, wants to build eight battery cell factories around the world, according to a statement.

Bank stocks were up ahead of the ECB meeting: in Paris, Societe Generale gained 1.74% to 24.56 euros, BNP Paribas rose 1.17% to 50.82 euros and Crédit Agricole by 0.96% to 11.74 euros.

In Frankfurt, Deutsche Bank rose 1.05% to 10.61 euros and Commerzbank 1.13% to 5.57 euros.

In Paris, the advertising giant gained 2.44% to 55.36 euros, taking advantage of the upward revision of its outlook for 2021. It expects to return to its pre-pandemic levels this year, against 2022 previously , driven by its growth in the United States.

Oil prices continued to rise. Around 11:10 GMT, a barrel of North Sea Brent for September delivery was up 0.94% to $ 72.91 in London from Wednesday’s close. In New York, a barrel of WTI for the same month rose 0.97% to 70.98 dollars.

The euro remained stable against the greenback (-0.04% to 1.1790 dollars), after having reached a low since the beginning of April the day before, at 1.1752 dollars.

Bitcoin also stabilized (-0.2% to 31,755 dollars).

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