Milan fell by 0.03%, Frankfurt by 0.08%, Paris by 0.09% and London by 0.16%. In Zurich, the SMI ended stable (-0.01%).
World stock markets fell on Wednesday, fearing the next results of the American technology giants after the disappointment caused by those of Microsoft.
Wall Street opened sharply lower, in particular the technology sector: the Nasdaq fell by 1.03%, the S&P 500 by 0.75% and the Dow Jones by 0.56%, around 4:55 p.m. GMT.
European indices returned close to balance after being clearly in the red for most of the session: Milan fell by 0.03%, Frankfurt by 0.08%, Paris by 0.09%, London by 0 .16%. In Zurich, the SMI ended stable (-0.01%).
“After starting the year in a very optimistic state of mind,” investors are stiffening with “earnings that paint a more realistic picture of the outlook for this year,” writes Oanda analyst Craig Erlam.
Layoffs, missed targets and pessimistic forecasts “are becoming the norm”, especially in the technology sector, he underlines.
This news tarnishes other positive economic signals, particularly in Europe. Germany is expected to narrowly escape a recession this year, the government said, with Europe’s biggest economy weathering the fallout from the war in Ukraine better than expected.
Moreover, investors are waiting to see the attitude adopted by the European and American central banks at the beginning of February. On Wednesday, Canada’s central bank raised its main interest rate by 0.25 percentage points to 4.5% on Wednesday, but indicated that it thought it would “maintain its current interest rate” at this level.
Microsoft worried
Investors, initially pleased with the resilience shown by Microsoft in its results, were finally worried after the conference call for analysts.
The company has put forward gloomy forecasts for demand this year, including slower growth in the cloud.
The action lost 1.12% around 4:45 p.m. GMT, after having lost more than 3% in the first exchanges. Alphabet yielded 3.38%, Amazon 1.78%
In Europe, better than expected results from the Dutch manufacturer of lithography systems for the ASML microprocessor industry enabled it to gain 0.23%.
Among other results
Boeing (-1.62%) recorded disappointing results in the fourth quarter of 2022, with a loss of $634 million, but the company maintained its forecast for 2023.
The American group of hygiene products Kimberly-Clark disappointed Wall Street on its turnover. The stock fell 3.36%.
Texas Instrument also fell -1.02% after publication of its results.
In Europe, Easyjet soared nearly 10% after its results.
Defense sector ignores Ukraine
Under pressure for weeks, German Chancellor Olaf Scholz on Wednesday gave his approval to send Leopard 2 heavy tanks to Ukraine, Russia denouncing an “extremely dangerous” decision.
Investors did not seem to believe in a risk of escalation, judging by the variations in the defense or energy sectors, notes Alexandre Baradez, analyst at IG.
Rheinmetall fell 0.99% in Frankfurt. The price gained 0.4% in the morning following the first information, before starting to fall again once the government’s green light was confirmed. Tanks supplied by Germany and other countries will have to be replaced, which suggests orders to come for the German industrialist who manufactures them.
Thales fell 1.38%. In Milan, Leonardo gained 2.56%.
On the side of currencies and oil
Little movement was taking place in the currency market. Around 4:30 p.m. GMT, the pound rose by 0.20% against the greenback, to 1.2359 dollars, the day after a sharp drop.
The euro was stable at $1.0889.
Oil prices were moving up slightly, after news that commercial crude oil reserves in the United States last week rose, but less than expected.
Around 4:35 p.m. GMT, a barrel of Brent from the North Sea for delivery in March advanced 0.73% to 86.76 dollars.
Its American equivalent, a barrel of West Texas Intermediate (WTI) for delivery the same month, gained 1.07% to 80.99 dollars.
The price of European natural gas fell further, falling 3.56% to 56.19 euros per megawatt hour.