European equities expected to open higher in hopes of a stimulus package in the US 

Eurostoxx 50 3,193.61 points -0.64% 
CAC 40 4,803.44 points -0.59% 
DAX 30 12,760.73 points -0.51% 
FTSE 100 5,866.10 points -0.53% 
SMI 10,187.00 points -0.41% 
AEX 547.70 points -0.22% 
BEL 20 3,235.44 points +0.02% 
IBEX 35 6,716.60 points +0.04% 
 
DJIA 27,781.70 points +1.20% 
Nasdaq 11,167.51 points +0.74% 
S&P 500 3,363.00 points +0.83% 
 
Nikkei 225 23,184.93 points 0.0% (trades interrupted for a technical problem) 
 
Exchange rate at 06:50 
Change from closing in New York 
 
EUR/USD 1.1750 0.00% 
EUR/JPY 123.87 +0.23% 
USD/JPY 105.44 0.00% 

Investors will be watching on Thursday for the final figures of the services PMI in September. Preliminary data, published by IHS Markit on September 23, showed the index rising to 50.9 from 49.8 in August.

On the corporate side, the Suez/Veolia saga continues. The energy group Engie said Wednesday evening to welcome "favorably" the improved offer presented by Veolia for its stake in Suez but asked the group of services to local authorities to extend its validity until October 5, 2020. Engie also asked Veolia to undertake not to launch a hostile takeover bid for Suez's shares. Veolia then announced in a statement that it had accepted these two requests.

On Thursday morning, the investment company Ardian entered the battle by announcing that it had expressed to Engie its interest in acquiring a 29.9% stake in Suez. "This expression of interest is supported by suez's board of directors and by the director representing the employees," Ardian said in a statement.

In addition, the biotechnology company Genfit presented on Wednesday its new strategic orientations, expressing its ambition to reduce by more than 50% its cash consumption by 2022 thanks to the implementation of a global savings plan that includes a 40% reduction in its staff.

The European Commission has conditionally authorised the proposed acquisition of Ingenico by Worldline, after the concessions made by the two French payment specialists.

Recreational vehicle specialist Trigano announced on Wednesday the appointment of Stéphane Gigou and Michel Freiche as Chairman of the Executive Board and Chief Executive Officer.

actions

European equity markets are expected to open slightly higher on Thursday for the first session of the fourth quarter, buoyed by the adoption by the US Congress of a temporary measure to avoid a partial shutdown of the federal administrations and the resumption of negotiations on a new stimulus package in the United States.

At 7:30 a.m., the CAC 40 futures contract gained 16 points, or 0.3%, according to data from broker IG Markets. The contract on the DAX 30 took 11 points, or 0.1%, and that on the FTSE 100 gained 16 points, or 0.3%.

The Senate of the United States has adopted by an overwhelming majority a short-term spending plan to finance the federal state until mid-December and avoid a partial government shutdown. President Donald Trump is expected to sign the bill, which was already approved by the House of Representatives last week.

For its part, the House postponed a vote on a $2.2 trillion stimulus package as Democrats tried to find a compromise with the White House on a new package to support the U.S. economy. According to Democratic parliamentary assistants, this postponement is intended to allow both sides to continue negotiations before the vote.

On Wednesday, Wall Street ended higher, supported by favorable economic indicators and hopes of progress in stimulus negotiations. The Dow Jones Index (DJIA) gained 0.8% to 27,683 points, and the broader S&P 500 Index gained 0.7% to 3,357 points. The Nasdaq, rich in technology stocks, gained 0.7% to 11,161 points.

With these increases, the indices closed a robust third quarter. The DJIA gained 7.6% between July and September, the Nasdaq advanced 11% and the S&P 500 rose 8.5%.

Many investors, however, remain wary after the first heated debate between the two candidates in the US presidential election, which has revived the risks surrounding this election.

In addition, the  Federal Reserve (Fed) has extended its restrictions on dividend payments and share buybacks of the largest U.S. banks for another three months to preserve their balance sheets from the repercussions of the coronavirus pandemic.

Until the end of the year, banks with more than $100 billion in assets will not be able to buy back shares and will have their dividends capped based on their profits, the Fed said.

These restrictions, initially in place until the end of the third quarter, affect 33 major banks including JPMorgan Chase, Citigroup, and Bank of America.

In Asia, trading on the Tokyo Stock Exchange was halted on Thursday for the entire session due to a technical issue. Mainland Chinese markets and the Hong Kong and Seoul stock exchanges are closed for public holidays in these countries.

On Thursday, investors' attention will turn to the manufacturing PMI, the producer price index and unemployment figures in the euro area. In the United States, they will track weekly jobless claims, the PCE index and the manufacturing PMI.

Obligations

U.S. Treasury yields rose on Wednesday as hopes that a new stimulus package would be adopted in the United States strengthened.

The yield on the ten-year Treasury bill gained 3.3 basis points to 0.677%. The market benchmark yield fell 1.8 basis points in September and rose 2.4 basis points in the third quarter.

FOREIGN EXCHANGE

The euro is rising on Thursday against the dollar, which is losing ground against most other major currencies.

According to the technical analyst of Central Trading, the euro/dollar pair shows an upward trend above 1.1710. The pair is trading Thursday morning at levels close to the overlapping 20- and 50-day moving averages. The RSI (Relative Strength Index), an indicator used to measure market dynamics, has risen to levels above 50, a sign of the absence of bearish momentum in the euro/dollar pair. Until the key support at $1.1710 is depressed, the euro is expected to continue its rise to $1.1755 and $1.1775.

Oil

Oil prices move little on Thursday, as the House of Representatives postponed its vote on a new stimulus package, to allow Democrats to find common ground with the White House.

At 7:20 a.m., the December contract for North Sea Brent was unchanged at $42.30 a barrel, while the November contract for Nymex-listed light sweet crude (WTI) lost 1 cent to $40.21 a barrel.