(Paris) European stocks closed higher on Wednesday despite disappointing Chinese economic data, while Wall Street sank into negative territory as investors awaited the release of US inflation figures on Thursday.
On the Old Continent, Paris ended up 0.72%, London gained 0.80% and Frankfurt 0.49%.
On Wall Street around 12 p.m. EST, the Dow Jones was down 0.69% and the S
One of the “essential points that drove today’s session” was “deflation in China which suggests that the Chinese state or central bank will take steps to revive the economy”, underlines Alexandre Hezez, analyst of the Richelieu group.
With a Chinese consumer price index down 0.3% in July, according to official figures released on Wednesday, the country is entering deflation for the first time since 2021.
While this isn’t “genuinely a surprise, it shows an economy out of sync: China is in deflation, Europe is still struggling with inflation, and the United States is in gradual disinflation and has almost won the fight against inflation,” comments Alexandre Hezez.
In this context, the publication of US inflation figures for July will be particularly watched on Thursday.
“Headline inflation is expected to rise to 3.3% from 3.0% in June” and a “larger figure would put a coin in the machine for further rate hikes in the fall” from of the American central bank (Fed), details Alexandre Hezez.
“The variations of the stock market indices could be exacerbated, linked to the few players present on the markets” at the heart of the summer period, warns the analyst.
The price of natural gas in Europe soared on Wednesday to its highest since mid-June, pushed by increased demand for liquefied natural gas (LNG) from Asia while periods of maintenance of installations and a possible strike by LNG facility workers in Australia could weigh on supply.
Around 11:50 a.m. (Eastern time) the Dutch TTF futures contract, considered the European benchmark, jumped almost 27% to 39.21 euros per megawatt hour (MWh), shortly after peaking at 43,545 euros. the MWh, a highest in almost two months.
However, “with inventory levels being relatively high, there is hope that the current price spike could be temporary,” said CMC Markets analyst Michel Hewson.
Bank stocks picked up on Wednesday after the Italian government decided to put a cap on the 40% tax announced Tuesday on the excess profits of banks generated thanks to the rise in interest rates, in order to calm the stock market storm.
In Milan, UniCredit gained 4.37% at the close, BPER 2.21%, Banco BPM 5.45%, Monte dei Paschi di Siena 2.47% and Intesa Sanpaolo 2.33%. BNP Paribas rose 1.37% in Paris, Commerzbank 0.59% and Deutsche Bank 1.61% in Frankfurt and Banco de Sabadell 1.03% in Madrid.
Electric vehicle maker Rivian slumped more than 8% in New York despite better-than-expected second-quarter results.
Rivian raised its vehicle production forecast to 52,000 from 50,000 for the year and reduced its operating loss projection.
U.S. weekly commercial crude oil reserves rose 5.9 million barrels, more than analysts expected, following a record low the previous week.
The price of crude, already on the rise before this announcement, climbed 1.20% to 87.17 dollars for a barrel of Brent from the North Sea for delivery in October around 11:50 a.m. (Eastern time).
That of West Texas Intermediate (WTI), for delivery in September, rose 1.23% to 83.94 dollars.
On the foreign exchange market, the euro gained 0.20%, to 1.0978 dollars for one euro.
Bitcoin fell 0.73% to $29,766.
