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OF Morning Report

01/03/2024
Categories: General Information

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This month of March started with a rise in European stock markets. This trend was motivated by the expectation of inflation figures in the eurozone. Thus, the Eurostoxx 50 is at 4,877.77 points (-0.12%), the CAC 40 at 7,927.43 points (-0.34%), the DAX 40 at 17,678.19 points (+0.44%), the FTSE 100 at 7,630.02 points (+0.12%), the FTSE 100 at 7,630.02 points (+0.07%), the SMI at 11,438.86 points (+0.21%), the AEX at 8488.86 points (+0.44%), the FTSE 100 at 7,630.02 points (+0.12%), the FTSE 100 at 7,630.02 points (+0.07%), the SMI at 11,438.86 points (+0.21%), the AEX at 848,21%. .44 points (+0.12%), the BEL 20 at 3,661.42 points (-1.04%), the IBEX 35 at 10,001.30 points (-0.67%), the DJIA at 38,996.39 points (+0.12%); the Nasdaq at 16,091.42 points (-1.04%), the IBEX 35 at 10,001.30 points (-0.67%), the DJIA at 38,996.39 points (+0.12%); the Nasdaq at 16,091.42 points (+0.12%); the Nasdaq at 16,091.92 points (+0.90%), the S&P 500 at 5,096.27 points (+0.52%) and the Nikkei 225 & agrave; 39,910.82 points

(+1.90%).

As for exchange rates, the change from the close in New York indicates that the EUR/USD opened at 1.0812 (+0.05%), the EUR/JPY at 162.67 (+0.37%), and the USD/JPY at 150.47 (+0.32%).

Investors are waiting for the final February manufacturing PMI numbers on Friday. Preliminary data, released by S&P Global and Hamburg Commercial Bank on February 22, showed the index rose to 46.8, a high point in 11 months, from 43.1 in January. Although lower than 50, the index reflects a contraction in activity.

European equity markets are expected to open higher on Friday, as investor attention turns to eurozone inflation figures, expected at 11:00am, and the final PMIs for manufacturing activity in the region. At around 7:30am, the CAC 40 futures contract gained 32 points, or 0.4%, according to data from broker IG, while the DAX 40 contract gained 69 points, or 0.4% as well. The one on the FTSE 100 advanced by 53 points, or 0.7%,

according to IG.

Economists polled by Wall Street expect inflation in the eurozone to slow to 2.5% year on year in February, after 2.8% in January. If the data is gradually approaching the European Central Bank's (ECB) 2% target, the European Central Bank (ECB) is expected to opt for the status quo on rates at the end of its monetary policy meeting next week

.

PMI indexes should highlight a further contraction in manufacturing activity in February in the eurozone. Preliminary data, published on February 22, showed the index at 46.1 in February, compared to 46.6 in January. Below 50, the index reflects a decrease in activity. Wall Street closed higher on Thursday thanks to technology stocks, after the announcement of inflation in line with expectations in January in the United States, according to the indicator preferred by the Federal Reserve (Fed) to monitor price developments

.

The Dow Jones Index (DJIA) rose 0.1% to 38,996.39 points, and the expanded S&P 500 index rose 0.5% to a new all-time high of 5,096.27 points. The Nasdaq Composite, rich in technological stocks, also set a new record at the close by rising 0.9% to 16,091.92 points. Unlike other American indices, which have set records since the start of the year, Nasdaq has so far failed to close above its previous high point, reached

in November 2021.

In Asia, markets are trending green on Friday. In Tokyo, the Japanese Nikkei index jumped 1.9% to end at a new record close of 39,910.82 points. The index was supported by the highs reached by the American markets on Thursday, as well as by the weakness of the yen against other major currencies. At the same time, the Hang Seng rose 0.7% at the end of trading in Hong Kong and the Shanghai Composite Index gained

0.3%.

According to official data released by the National Bureau of Statistics on Friday, the manufacturing PMI index stood at 49.1 in February, after 49.2 in January. Below 50, the index signals a contraction in activity this month. Economists polled by the Wall Street Journal were expecting an index of 49. At the same time, the manufacturing PMI published by Caixin and S&P Global rose to 50.9 in February, after 50.8 in January. Above 50, the index indicates an expansion in activity for the fourth consecutive month

.

US Treasury bond yields are not changing much on Friday morning, as investors no longer expect the Fed to cut interest rates until June. Data released on Thursday on inflation in the United States proved to be in line with economists' expectations and market attention is beginning to focus on February employment figures, expected at the end of next week. After 353,000 job creations in January, a higher number than expected, Capital Economics expects 250,000 hires in February, while wage growth should continue its

downward trend.

The euro was relatively stable on Friday against the dollar. The March meeting of the European Central Bank (ECB) should not encourage investors to rush to the euro, but the single currency should continue to appreciate if the market starts to anticipate a first cut in interest rates later than currently, say analysts at Nomura

.

Oil futures are rising on Friday as signs of supply tensions mount and the war between Israel and Hamas continues. Prolonged production cuts by the Organization of Petroleum Exporting Countries and its allies in OPEC+ are supporting prices, says Saxo's team of strategists. At around 7:20am, the May contract on North Sea Brent gained 39 cents, at 82.30 dollars per barrel, and the April contract on light sweet crude (WTI) listed on Nymex took 33 cents, at

78.59 dollars per barrel.
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