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OF Morning Report

28/12/2023
Source : ORISHAS FINANCE
Categories: General Information

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After a new record on Wall Street, European equity markets are expected to rise. Eurostoxx 50 opens at 4,528.38 points (+0.15%), the CAC 40 at 7,571.82 points (+0.15%), the CAC 40 at 7,571.82 points (+0.04%), the DAX 40 at 16,742.07 points (+0.21%), the FTSE 40 100 to 7,724.95 points (+0.36%), the SMI at 11,113.98 points (-0.35%) ), the AEX at 786.84 points (+0.18%), the BEL 20 at 3,711.12 points (+0.85%), the IBEX 35 at 10,121.80 points (+0.10%), the DJIA at 37,656.52 points (+0.18%), the DJIA at 37,656.52 points (+0.30%), the Nasdaq at 15,099.18 points (+0.16%), the S&P 500 at 4,781.58 points (+0.14%), the Nikkei 225 at 33,539.62

points (-0.42%).

As for exchange rates, the change from the close indicates that in New York, the EUR/USD is at 1.115 (+0.07%), the EUR/JPY at 156.98 (-0.36%), and the USD/JPY at 141.24 (-0.43%), the EUR/JPY at 156.98 (-0.36%), and the USD/JPY at 141.24 (-0.43%).

Yesterday, the European aeronautics and defense group Airbus announced that it had delivered to the Turkish airline Pegasus Airlines the first single-aisle A321neo aircraft rolled off its new assembly line located near Toulouse. The aircraft manufacturer said in a statement that it should contribute to Airbus' objective of reaching a production rate of 75 A320 family aircraft per month by 2026

.

The macroeconomic agenda is empty on Thursday and there are no events on the business agenda.


On this day, European equity markets are expected to open higher. They are supported by the optimism of investors about a reduction in interest rates in 2024. The DAX 40 contract grew by 58.3 points, or 0.4%, and the FTSE 100 contract rose 24.8 points, or 0.3%. At around 7:10am, the CAC 40 futures contract gained 24.9 points, or 0.3%, according to

data from broker IG.

After a hesitant session, the New York Stock Exchange closed higher on Wednesday, allowing the Dow Jones Index to set a new all-time high as investors continue to bet on an easing of monetary policy next year. The leading index of industrial stocks ended with a gain of 0.3%, at 37,656.52 points, erasing its previous record, which dated December 19. While inflation in the United States is falling back towards the central bank's 2% target, the American equity market is buoyed by the hope that the Federal Reserve (Fed) will start cutting rates next spring.
Michael Landsberg, chief investment officer at Landsberg Bennett Private Wealth Management, said that “the financial markets are too optimistic about the number of rate cuts expected in 2024, and we may have already achieved some of the progress of 2024 with the end-of-year rally, because we don't think there will be as many rate cuts as the market currently

integrates.”

Asian equity markets are growing overall. At the end of the session, the Hang Seng on the Hong Kong Stock Exchange gained 2.6% and the Shanghai Composite rose by 1.4% at the end of the session. At the same time, in Tokyo, the Nikkei index closed down 0.4%.


While investors continue to bet on a decline in inflation and a fall in Fed interest rates, US Treasury bond rates rose slightly on Thursday after falling yesterday. After a five-year bond auction, rates continued to fall on Wednesday afternoon. The CME Group FedWatch tool indicates that the markets take into account an 85.5% probability that the Fed will leave its key interest rate unchanged, in a range of 5.25% to 5.50%, at the end of its meeting on January 30 and 31. At the next meeting, to be held in March, the probability of a reduction of at least 25 basis points is estimated at 84.6%. According to operators, by December 2024, the federal funds rate will have been brought down to a range of 3.75% to 4%.


This morning, the euro gained ground against the dollar, but fell against the yen, like the greenback. While investors expect the Fed to cut its rates next year, the dollar is being penalized by the fall in U.S. Treasury bond yields. According to Swissquote, “the dollar is still under pressure.” The financial intermediary indicates that buyers rushed to US Treasury auctions “to get good deals before the end of the year by revising a rate cut by the Fed starting next spring

”.


While investors continue to monitor developments in the Red Sea in light of the risks of disrupting oil deliveries, oil futures rose slightly this morning. For Tonghui Futures, geopolitical uncertainties in the Middle East will be the main factor affecting short-term crude prices. The market has fully integrated the Fed's expectations of lower interest rates. The March contract for soft light crude (WTI) listed on Nymex rose by 10 cents to $74.21 per barrel. The North Sea Brent contract at the same maturity gained 16 cents to $79.70 per barrel at 7:25

am.
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