MARKETS EUROPE / Consolidation – ECB ahead after the rally | News

FRANKFURT (Dow Jones) – After a friendly start, Wednesdays, European stock exchanges have switched to the consolidation course. Strong gains of almost 500 points from the previous day’s low to high require a respite, as is said in trading. Fund managers would first need to weigh their individual stock market positions after the rally. DAX slightly increased to 13,327 points, euro-Stoxx-50 also gained 0.1 percent.

In general, however, one can feel a relief in connection with the assumed resumption of Russian gas supplies. In the morning, Nord Stream announced that the maintenance work was normal and uninterrupted. Regardless, the price of gas is now rising again by almost 4 percent after the previous day’s decline.

However, CMC Markets notes that the situation is “just as bad” as it was before speculation. “Even if the GAU does not come to an end yet, it does not mean that the German economy is on the right track again,” says analyst Jochen Stanzl. A list of energy dependency unknowns, too high inflation, one Monetary policywhich due to fragmentation in Eurozone hands are tied to some extent and geopolitical crises last too long to allow for lasting improvement.

Inflation falling from extremely high levels

Inflation concerns are relegated to the background. The prices of German producers rose in June by 32.7 percent compared to the previous year. A series of sharp price jumps above 30%. Thus, it was continued, but at the same time, for the first time in a long time, the increase was lower than in the previous month. In addition, economists expected as much as 33.9 percent. In the UK, consumer prices rose by 9.4 percent, in line with forecasts.

At Thursday’s ECB meeting, the market seems to be almost indifferent to an interest rate hike of 25 or 50 bps. According to Commerzbank, an increase of 37 basis points is currently priced in. With an increase of 0.25 percent. the deposit rate for banks would remain negative, which many market participants consider inappropriate given the excessively high inflation.

Italy is still in the spotlight as a possible problematic spot. Investors are looking forward to the speech of the Italian Prime Minister Mario Draghis in front of the parliament. Draghi’s resignation, and with it the collapse of the government coalition, is not out of the question. Strategist Jim Reid of Deutsche Bank notes that the ECB is apparently considering a large 50bp rate hike despite the politically unstable situation in Italy, which indicates that it is using its anti-fragmentation instrument to protect markets from interest rates too large differences in the euro area may to convince.

Economic action with gas in focus – Uniper continues to grow

Cyclical stocks, in particular, are the winners as concerns about gas supplies are alleviated. Chemical equities, for example, continued to decline after the yesterday’s rise (-0.1%). Here, too, is pressing minus Akzo Nobel, the share price is losing 2.5%. Higher costs negatively affected the company’s results for the second quarter. Despite better sales results, the profit was below market expectations.

Uniper continued its strong recovery with a positive 5.5 percent. “If Russian gas flows again and the purchase price should drop, the price should still have a lot of potential for a recovery,” said one market participant. The reports on the imminent securing of liquidity by the state are helpful in the rate. Fortum Mother Mileage Gains 2.0%

Technology inventories grow minimally (+ 0.1%). They argue that hedge funds for weeks have taken advantage of the high volatility of the options market to make it cheaper.

However, minus 1.5 percent in ASML has an inhibitory effect. A supplier for the semiconductor industry lowered its sales prospects. However, this is more of a time problem, the last quarter data is strong on both the sales and earnings side, and the margin development is in line with high expectations, it is said.

Antofagasta gained 0.7 percent. on the London Stock Exchange – despite lower production targets for the current year.

New data from automotive supplier Hella (-0.2%) hardly caused any price changes. According to Citigroup, they turned out to be slightly weaker than expected. Both in terms of sales and operating profit, expectations were not met. According to analysts, the development of the margin emphasizes the problems of automotive suppliers. Faurec’s mother price is also slightly falling.

Stock index last + / -% absolute + / -% YTD

Euro Stoxx 50 3 590.69 + 0.1% 3.25 -16.5%

Stoxx 50 3 565.15 + 0.1% 3.06 -6.6%

DAX 13,326.84 + 0.1% 18.43 -16.1%

MDAX 26 709.74 + 0.7% 194.21 -24.0%

TecDAX 2 982.60 + 0.3% 8.72 -23.9%

SDAX 12,473.74 + 0.4% 47.47 -24.0%

FTSE 7 331.44 + 0.5% 35.16 -2.2%

CAC 6 220.07 + 0.3% 18.85 -13.0%

Fixed Income Market Last Absolute +/- YTD

10-year return from Germany 1.24 -0.04 +1.42

10-year profitability in the USA 2.99 -0.04 +1.48

FOREX last +/-% Wed 8:37 Tue 17:25% YTD

EUR / USD 1.0234 + 0.1% 1.0232 1.0239 -10.0%

EUR / JPY 141.36 + 0.0% 141.26 141.10 + 8.0%

EUR / CHF 0.9926 + 0.2% 0.9920 0.9913 -4.3%

EUR / GBP 0.8525 + 0.0% 0.8527 0.8515 + 1.5%

USD / JPY 138.10 -0.1% 138.29 137.81 + 20.0%

GBP / USD 1.2005 + 0.0% 1.1998 1.2025 -11.3%

USD / CNH (offshore) 6.7574 + 0.2% 6.7565 6.7469 + 6.3%

Bitcoin

BTC / USD 23,422.13 -1.0% 23,635.89 22,818.02 -49.3%

ROHOEL the last VT-Settl. +/-% +/- USD% YTD

WTI / Nymex 102.40 104.22 -1.7% -1.82 + 41.9%

Brent / ICE 105.80 107.35 -1.4% -1.55 + 41.2%

GAS VT close +/- EUR

Dutch TTF 161.00 154.60 + 4.2% 6.54 + 41.5%

METALS last day before +/-% +/- USD% YTD

Gold (spot) 1,707.93 1,711.75 -0.2% -3.82 -6.7%

Silver (Spot) 18.83 18.75 + 0.4% +0.08 -19.2%

Platinum (Spot) 882.55 878.00 + 0.5% +4.55 -9.1%

The future of copper 3.36 3.29 + 2.1% +0.07 -24.4%

YTD at the end of the day

Contact the author: maerkte.de@dowjones.com

DJG / mod / voice

(END) Dow Jones Newswires

July 20, 2022 4:31 AM ET (8:31 GMT)

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