EU stock markets lose momentum in the final hours; Milan closes unchanged
Signs of a slowdown in US inflation are continuing. Crude oil prices are falling sharply, with Brent at around $88 a barrel; gas prices in Amsterdam are also down
(Il Sole 24 Ore Radiocor) - European stock markets slowed towards the close and ended the day lower, despite the fact that US producer prices, which were better than expected, combined with the slowdown in inflation seen the previous day, had allayed fears that the Fed might opt for monetary tightening at its next meeting in September. The FTSE MIB in Milan thus ended the session down 0.01% after coming close to a new all-time high. The AEX in Amsterdam was up (+0.57%), whilst the CAC in Paris (-0.3%), the DAX in Frankfurt (-0.12%) Madrid’s Ibex (-0.2%) and London’s FTSE 100 (-0.66%).
The US data has therefore eased fears of a surge in inflation and, consequently, of a rise in interest rates, with the CME FedWatch tool estimating a 34.4 per cent probability of a rate hike, down from 50 per cent earlier that morning. The fall in crude oil prices is also helping to fuel the sense of optimism, despite the deadlock in negotiations over the reopening of the Strait of Hormuz, over which both Iran and the United States claim to have control.
Wall Street on the rise
Wall Street closes higher. The Dow Jones gained 0.13% to 53,840.08 points. The Nasdaq rose by 0.81% to 26,803.03 points and the S&P 500 climbed by 0.65% to 7,799.18 points. The markets were buoyed by producer price figures, which remained unchanged in July, whilst on an annual basis stood at 4.7 per cent, better than expected. The figure reinforces the positive signs of falling inflation that emerged the day before with the consumer price index. Claims for unemployment benefits were broadly in line with expectations. Also contributing to the positive market performance is the fall in crude oil prices, despite persistent uncertainty regarding a possible reopening of the Strait of Hormuz.
Saipem tops the table in Milan; Nexi performs well
On the Milan Stock Exchange , Saipem closed at the top of the table, up 3.64% , after securing an offshore contract in the Middle East worth around 1.8 billion dollars. There was also buying interest in Nexi (+2.37%), with rumours suggesting that CDP Equity’s stake could rise from 19.6% to 29.9% in the short term, and in Fincantieri (+2.52%). The focus is on the banking sector, particularly Unicredit (+0.78%) following Reuters reports that the ECB is set to approve the acquisition of Commerzbank. Frankfurt is said to have found no grounds to oppose the merger, whilst anticipating a ‘complex and protracted’ integration. Attention is also turning to Banco Desio, whose new CEO, Stefano Kuhn, stated in an interview with Il Sole 24 Ore that the bank is “ready for new acquisitions”. Bringing up the rear are Inwit (-1.64%) and Unipol (-1.79%). Outside the main index, keep an eye on Technoprobe (+0.46%), which is set to join the FTSE MIB in September (+137% year-to-date).
Oil prices fall, gas prices remain largely unchanged
As regards raw materials, the Strait of Hormuz remains a key focal point in the conflict between the United States and Iran, whilst the memorandum of understanding signed on 17 June is due to expire on Sunday 16. The market remains optimistic, however, with crude oil prices falling, partly due to weaker demand following OPEC’s downward revisions: Brent for October is down 1% at $88 per barrel, whilst WTI for September settlement stands at $82.3 (-1.1%). Natural gas traded in Amsterdam was largely unchanged, at €60.7 per megawatt hour (-0.3%).
