The first weekly sequence for July ended with a 2.5% rise for European stocks (STOXX Europe 600 Net Return) and just over 2% for US stocks (S&P500). On the Asian markets side, Japanese stocks rose by the same proportions with an increase of 2.30% (Topix) while Chinese stocks clocked the time by making 0.93% (Shanghai Composite), a pause that comes nonetheless after five consecutive weeks of increase. The VIX index, which measures market tension, continues to fall to 24 points. However, sentiment from the previous weekend is a bit muddled. Perhaps because economists and financiers are completely unaware, the former accurately predicts the trajectory of growth and inflation in advanced economies, and the latter predicts the monetary tightening of the Federal Reserve well in advance.
In this regard, the latest US employment report has somewhat undermined the bets of investors who were relying on the “things are going bad, so they are going well” scenario, believing that deteriorating economic indicators would limit the Fed’s tough stance. . On the contrary, the labor market has performed much better than expected since US companies created 372,000 jobs in June, well above the 265 thousand that the Bloomberg consensus had expected. So we are still far from the “slack” box that has caused so much ink to flow in recent weeks. Investors therefore expect a strong move from the Federal Reserve, which should raise rates by 75 basis points at the end of the month, a necessary evil to drain liquidity and accompanying inflation. Looking at CME’s FedWatch tool, I find that the market even paved the way for a 100 basis point rate hike, but let’s face it, the probability of such an increase remains low (less than 10%).
Let’s not stray from the monetary policy record because this week the central banks topic will be highlighted with comments and press conferences from central bankers coming from all sides, with the Federal Reserve (today and Thursday), the Bank of England (today and tomorrow), the BOC (which will make the interest rate decision). Wednesday). The Bank of Japan has already opened the ball tonight. In keeping with the ebb and flow of the rest of the world, the BoJ announced that it could take further monetary easing measures if needed. Finally, regarding major macroeconomic events that are spinning in the red on your calendars, the first US inflation numbers for June are due on Wednesday. Producer prices will follow on Thursday and retail sales on Friday, the same day the University of Michigan Consumer Sentiment Index is released. Suffice it to say, there will be much to fuel the great debate about growth and inflation.
Plus some news not to be missed this weekend:
- Social hype is building in Sri Lanka, and the island is bearing the full brunt of the price hike.
- Joe Biden will travel to Saudi Arabia this weekend to extract an increase in oil production.
- The French government is preparing people’s minds for the possible total cut off of Russian gas.
- Beijing announces new sanctions targeting tech giants, including Alibaba and Tencent.
- Four new candidates announce the succession of Boris Johnson.
- Elon Musk is giving up taking over Twitter.
The major European indices are bearish this morning. In Asia, Japan is up, investors are appreciating the ruling coalition’s big victory but China is falling: tech stocks are suffering as the Chinese regulator announced a new round of sanctions against tech giants, and the news isn’t too good on the COVID front in Beijing. As a result, the Hang Seng index shrank by more than 3% overnight.
Today’s major economic events
There will be no major economic statistics on the agenda at the start of the week.
L ‘euro It is trading at 1.014 USD. gold ounce Slump at $1,742. The oil goes down a bit with a Brent From the North Sea at 106 dollars a barrel and light US crude oil West Texas Intermediate At $103. performance US debt In 10 years it has increased slightly to 3.08%. The Bitcoin It loses ground at 20,500 USD.
Major changes in recommendations
- ABB : Citigroup switches from long to neutral and lowers its target from 35 to 29 Swiss francs.
- Adidas: Deutsche Bank is still tall but adjusts its target from €305 to €240.
- Allianz: Jefferies is still long but with a price target down from 255 to 240 euros.
- Alstom: Citigroup lowers its target from 42 to 38 EUR.
- Axa: Jefferies maintains its buy recommendations but has lowered its target from 30.50 to €28.
- BHP Group: Jefferies is long but has dropped its target from A$82 to A$77.
- French electric company: JP Morgan raised its weight gain recommendation with a price target of €12.
- FlatexDegiro: Morgan Stanley begins follow-up with a recommendation to lose weight.
- Fraport AG: JP Morgan is neutral with a reduced price target of 55 to 51 EUR.
- Holcim: JP Morgan goes from short to neutral with an unchanged price target of CHF53.
- Julius Bar: RBC is still outperforming but is lowering its target from CHF60 to CHF58.
- Legrand: Citigroup lowers its target from 85 to 80 EUR.
- Levi Strauss: Morgan Stanley stays long but lowers its target from $33 to $19.
- Life Storage: Citigroup is a buyer but is reviewing its target of $150 to $133.
- Malibu Boats: Trust Securities is tall but lowers its target from $80 to $70.
- Morgan Stanley: Jefferies is still tall but adjusting its target down from $109 to $97.
- NVIDIA: Tigress Financial remains long with target price lower from $410 to $310.
- Pernod Rijkaard: Deutsche Bank is still on the buy side with the price target rising from €234 to €242.
- Renault: Jefferies is still buying at €40 while Stifel, who is also buying, has lowered his target from €55 to €41.
- Roche Holding: UBS moves from seller to neutral but lowers its target from 345 to 328 Swiss francs.
- Siemens Gamesa: Mirabaud Securities moves from long to neutral with a target of €18.10.
- Soitec: Deutsche Bank lowered its target from 225 to 175 euros.
- Charles Schwab: Jefferies is still long with a low target price of $95 to $78.
- Tradeweb Market: Credit Suisse is still tall but lowers its target from $101 to $88.
- Wells Fargo: Seaport Global Securities remains long-term, but lowers its target from $67 to $57.
Important (and less important) ads
- STMicroelectronics and Global Foundries will set up a semiconductor plant in France, with an investment of about 4 billion euros according to Le Figaro.
- Sanofi and Swedish Orphan Biovitrum AB provide positive data on stage 3 in hemophilia A.
- Airbus delivered 60 commercial aircraft in June and registered 78 new orders.
- Neoen launches construction of its first wind farm in Sweden.
- Valorec appoints new director for South America.
In the world
Important (and less important) ads
- Netflix exceeds 10 million subscribers in France.
- Beijing fines Alibaba and Tencent for not complying with antitrust rules.
- Elon Musk stopped buying Twitter, which started legal action.
- Tesla will halt production for two weeks at its new factory outside Berlin.
- Dufry buys Italian autogril.
- Volvo Cars is leaving the European Automobile Manufacturers Association (ACEA).
- Danske Bank lowers earnings forecast for 2022.
- Aker BP has discovered a gas field in the Norwegian Sea.
- Wind turbine manufacturer Nordex will launch a $215 million fundraising drive.