(Paris) Recession fears weigh on Asian and European markets on Thursday as investors calmly wait for a key US jobs report that could guide the US central bank for its interest rates.
In Asia, Tokyo dropped 1.22%, Shanghai ended in equilibrium and Hong Kong fell 0.34% around 3:15 a.m. EST.
The European indices were guarded against all haste before the long Easter weekend and the publication of the monthly US employment report on Friday, a holiday for the markets. Around 3:25 a.m. (Eastern time), Paris took 0.21%, Frankfurt 0.19% and London 0.43% the day after a negative session.
Since the beginning of the week, several statistics illustrating the economic slowdown in the United States have fueled fears of recession, investors wondering if the American central bank has not gone too far in monetary tightening in order to fight inflation. .
“It seems markets want to believe that the economy is slowing down, which it likely is, that recent rate hikes are to blame, and that the Fed is going to have to change its monetary policy stance soon,” Michael Hewson said. for CMC Markets.
While they had been hoping for months for signs of easing in the American labor market and an economic slowdown to foresee an imminent end to the cycles of rate hikes by the Federal Reserve (Fed), investors are now worried about the health of the world’s largest economy.
Weaker-than-expected private job creation in March and especially the stronger-than-expected slowdown in services activity (ISM) published on Wednesday in the United States are raising fears because they pose a risk of contraction .
According to experts, the next few days’ data on jobs and inflation will be decisive in determining whether or not the US central bank (Fed) will raise its key rate by another 25 basis points at its next meeting in May.
But according to Hewson, given inflation that remains high, do not expect a hasty pivot from the Fed to cut rates, a pattern in which the markets are currently taking pleasure.
Elsewhere, the news is more positive: in China, activity in services saw its strongest acceleration in more than two years in March after the abandonment of health restrictions against COVID-19.
But this good news for investors was offset by geopolitical tensions in Asia-Pacific, against the backdrop of the visit to California by the President of Taiwan.
In Germany, too, the risk of a recession is receding: after the sharp rise in industrial orders and the jump in exports in February, industrial production rose more than expected in February.
For its part, India’s central bank surprised markets by keeping its key rate unchanged at 6.5% on Thursday, after six successive hikes since May 2022, citing “unprecedented uncertainty” in the geopolitical and market context. financial.
Rakuten Group stock fell 0.64%. The price range per share for the IPO of its subsidiary Rakuten Bank, scheduled for April 21 in Tokyo, was lowered on Wednesday to 1300-1400 yen, against an indicative range of 1630-1960 yen previously.
The yen was stabilizing against the dollar, which was trading at 131.31 yen for a greenback around 3:15 a.m. EST from 131.32 yen at 5 p.m. EST on Wednesday.
The euro gained 0.10% against the dollar, to one euro for 1.0915 dollars.
The oil market was in the red: around 3:15 a.m. (Eastern time), the barrel of American WTI yielded 0.53% to 80.20 dollars, and the barrel of Brent from the North Sea fell by 0 .51% to $84.69.
