Most rises in Europe after S&P 500 highs
European stock markets open slightly higher, except in the case of the Dax, but without a definite trend, in an environment of low activity. Dax down 0.03%; while the Cac 40 rose 0.08%, the FTSE 100, 0.23% and the Mib, 0.04%. The Euro Stoxx 50 is up 0.06%.
“The fact that yesterday the S&P 500 reached a new all-time high at the end of the day, we do not believe that it will serve to encourage investors in Europe, who have been showing signs of a certain” altitude sickness “for a few days” , indicate Link Securities analysts.
Wall Street closed this Thursday in positive territory and one of its main indicators, the selective S&P 500, registered a new record after a day marked by the highest inflation data in the US since 2008.
The S&P 500 rose 0.47% to 4,239.18, while the Dow Jones Industrials advanced 0.06% and the Nasdaq 0.78%.
Wall Street reacted with buying to mixed data on the US economy and lifted the broadest indicator of the market, the S&P 500, to an all-time high after a month of swings.
On the one hand, the consumer price index (CPI) rose 0.6% in May, placing interannual inflation at 5%, the highest registered in the country since August 2008. The increase in inflation, which It generated fears last month about the possibility that the Federal Reserve began its withdrawal of stimuli, it was interpreted this time as something transitory.
On the European stock markets, the ECB meeting passed without pain or glory, since neither the institution, which kept its main monetary policy parameters unchanged, nor its president, Christine Lagarde, at the press conference after the Council meeting, they went off the script.
Thus, the ECB leaves its reference interest rate intact at 0.0%; the deposit facility at -0.5% and the marginal credit at 0.25%. In addition, the ECB indicated in its statement that it will maintain the current monthly asset purchase rate of its Pandemic Emergency Purchase Fund (PEPP), which is somewhat higher than the one it maintained a few months ago; at a significantly higher rate than at the beginning of the year, in the institution’s verbatim words. Likewise, and with regard to inflation, the ECB indicated that it believes that its rebound is temporary and that it will not be prolonged in time because in the Eurozone there is no risk of overheating, as there is in the US.
In its statement, the ECB also indicated that it will recalibrate the evolution of the PEPP to maintain favorable financing conditions in the Euro Zone, and that this program will remain in force at least until March 2022 or until the crisis is overcome.
On the other hand, the ECB presented its new updated macroeconomic table for the Eurozone. Thus, the institution’s analysts expect the Eurozone’s Gross Domestic Product (GDP) to grow 4.6% in 2021 (4.0% in their March estimates); 4.7% in 2022 (4.1% in March); and 2.1% in 2023. Regarding inflation, the ECB now expects this variable to stand at 1.9% in 2021 (in March it projected 1.5%); by 1.5% in 2021; and 1.4% in 2023.
In the subsequent press conference, Lagarde pointed out that the risks to the growth of the eurozone economy are now balanced, and that the ECB expects economic activity to accelerate in 2H2021 “strongly” driven by domestic demand.
However, Lagarde warned that the recovery will be accompanied by inflation and that the bank’s projections include a rise in prices. In this sense, he said that the rise in inflation is explained by the base effect of the comparison and by transitory factors, so he expects inflationary pressures to moderate once these elements are overcome.
Furthermore, he expects it to continue below the ECB’s target closely, but below 2% over the horizon of the institution’s projections.
Today the stock markets will be awaiting the publication this afternoon in the US of the preliminary reading for June of the consumer sentiment index prepared by the University of Michigan, an index that is a good leading indicator of private consumption, a variable that in turn represents almost 70% of US GDP.
The euro advances against the dollar and is exchanged at 1,219 greenbacks.
The INE confirms the rise in the CPI in May to 2.7%, its highest rate in four years, due to gasoline
The Consumer Price Index (CPI) rose 0.5% in May compared to the previous month and placed its interannual rate at 2.7%, five tenths above that of April (2.2%), according to the data published this Friday by the National Institute of Statistics (INE), which confirms the advanced data at the end of last month.
The UK’s gross domestic product (GDP) expanded by 2.3% in April compared to the previous month, when it had grown by 2.1%, representing the largest increase in activity since July 2020 as a result of the uprising. of restrictions, according to data published by the National Statistical Office (ONS).
Reference Brent oil in Europe dropped 0.10% to $ 72.45, while West Texas dropped 0.10% to 70.22