Aside from the surrounding behavior, which reeks of daddy’s finance, is a central banker different from an influencer? For the stock market, not at all. Obviously, Jerome Powell’s tweets are less funny than Elon Musk’s, but each of his public outings is followed by the devotion of the financial community, which ultimately wants to know whether to bet everything of grandpa Buffett’s strategy or if, in the end, this too. it will be possible to get 50% in three months in any shaky company that sells technological items of dubious use. So to summarize what happened yesterday and what will happen today: the central bankers get the power, until 3:10 pm Paris time, when they will be replaced by Jerome Powell, the father (bogeyman ) of all central bankers.
Let’s start with yesterday’s session. US equities rebounded strongly after a series of disappointing sessions, driven by the most cyclical rating compartments. Only oil stocks marked the season, with a brief return of the barrel of American WTI light crude oil below the symbol bar of 80 USD, a first since January. The Nasdaq 100 recovered more than 2% with 5 declines for 95 gains recorded. In Europe, markets generally closed with small gains or at least not far off balance, except in London where the FTSE 100 fell 0.9% due to strong contingents in oil and mining stocks.
Fed Vice Chair Lael Brainard helped cement the rebound on Wall Street. In a speech given yesterday, he brought a touch of positivity by warning the central bank against the risks associated with excessive monetary tightening. In recent weeks, members of the Fed have suggested that we should hit inflation as hard as possible and then think. That said, Brainard is in his role: he is one of the personalities sitting in the central bank who is considered the most flexible (one says “dove”, as opposed to the more orthodox “hawks”) vis-à-vis of Monetary Policy. So it should act as a counterweight in times of monetary tightening.
So it is difficult to escape the central bankers today because the European Central Bank has to give its monetary decision at 2:15 pm Historically, the ECB communicates at 1:45 pm but a new schedule is started this summer. The presentation of the decision conference, always very popular because the financiers seek to better understand the intentions of the institution, starts at 2:45 pm There is a little telescoping in the calendar because Christine Lagarde is likely to speak again when his Fed counterpart, Jerome Powell, will take the microphone for a conference in the United States (3:10 pm). Will he agree with Lael Brainard or will he continue to play butt? Reply in the afternoon. As for the ECB, the screws must be tightened to try to regain control of inflation. Forecasts are in favor of raising the main refinancing rate in three quarters of a point, which will increase it from 0.50 to 1.25% and will be an unprecedented movement. To be precise, the forecast is between 0.50 and 0.75 points up, with a slight bias in favor of 0.75. Everything is not resolved, but one thing is certain: the price of silver will continue to rise in the euro zone, at a time when the energy crisis presents many new risks to the region.
In the rest of the news, there is intense discussion in Europe about energy prices. In the oil market, the price rebounded slightly after continuing to decline yesterday.
The big rebound recorded in the United States yesterday boosted equities in Japan (+2%) and Australia (+1.6%). Chinese squares, on the other hand, seem to have their own lives that prevent them from behaving like others. They fell this morning, as China’s zero covid policy continues to lead to closures/reopenings in more or less populated areas. What will add to the current fears of the country’s development, was reinforced yesterday by moderate foreign trade figures for the month of August. In Europe, the leading indicators point to a green start to the session, as the previous day’s gains were relatively far from those obtained on Wall Street. The CAC40 gained 0.4% to 6134 points at the opening.
Economic highlights of the day
The ECB will deliver its monetary policy decision today at 2:15 pm, followed by a conference to present the decision at 2:45 pm In the United States, weekly jobless claims (2:30 pm) will before the speech of Jerome Powell (Fed) shortly after 3:00 pm. The full macro diary here. This morning, Japan announced that Q2 GDP was finally a bit more dynamic than expected.
The euro rose to 0.999 USD. The ounce of gold also returned to 1714 USD. Oil is trying to stabilize, with North Sea Brent at $88.65 per barrel and US WTI light crude at $82.65. The yield on US 10-year debt fell again to 3.23%. Bitcoin rallied around $19,300.
The main changes in the recommendations
- A2A: Morgan Stanley started online weight tracking targeting EUR 1.35.
- Asos: Jefferies from buy to hold, targeting 775 GBp.
- Atos: Goldman Sachs from neutral to sell, targeting EUR 8.
- Aveva: HSBC from buy to save, targeting 3090 GBp.
- CD Projekt: Morgan Stanley from underweight to overweight online by targeting 87 PLN.
- Compagnie Financière Richemont: Bernstein moved from outperformance to market performance.
- Epiroc: HSBC moved from hold to buy target at 200 SEK.
- GSK: Jefferies moved from buy to hold, targeting 1475 GBp.
- ITV: Morgan Stanley moved from online weight to underweight by targeting 55 GBp.
- Krones: Berenberg from sale to storage, aiming for 90 EUR.
- LVMH: Jefferies is still buy with a target price raised from 700 to 740 EUR.
- Novartis: Morgan Stanley remains weighted in line with a reduction in the price target of 94 to 88 CHF.
- Ocado: Barclays from underweight to overweight online by targeting 775 GBp.
- Polypeptide: Morgan Stanley from overweight to underweight online by targeting 50 CHF.
- ProSiebenSat: Morgan Stanley moved from online weight to underweight by targeting EUR 7.
- Publicis: Redburn continues to follow-up on the purchase.
- Roche: Morgan Stanley remains weighted in line with a reduced price target of 370 to 350 CHF. Jefferies from hold to buy target 375 CHF.
- Siegfried: RBC went from outperformance to sector performance by targeting CHF 860.
- SLM Solutions: Kepler Cheuvreux from purchase to storage, targeting EUR 20.
- Sogeclair: GreenSome Finance remains bullish with a target reduction from 28.50 to 26.60 EUR.
- TFF Group: Kepler Cheuvreux remains high with the target raised from 37 to 42 EUR.
- Thales: Societe Generale from purchase to storage, targeting 137 EUR.
- Valneva: Portzamparc from hold to buy, targeting EUR 11.
- Zalando: Berenberg has kept a target reduction from 36 to 26 EUR.
- Zurich Insurance: Barclays remains overweight with a target raised from 500 to 525 CHF.
Important (and not so important) notices
- Saint-Gobain wants to separate from British building materials retailer Jewson.
- Credit Agricole will buy 4.8% of the capital of Credit Agricole Egypt.
- Thales will provide Emirates with a new in-flight entertainment system.
- Rémy Cointreau launched a share buyback involving a maximum of 1.9% of its capital.
- Euronext saw low volume in the spot market and capital gains in August.
- TF1 assigned Canal + (Vivendi) summary proceedings to the commercial court after the broadcast was interrupted.
- Voltalia has signed two solar projects in the United Kingdom.
- Getlink releases August traffic figures.
- Valneva and VBI Vaccines have signed a partnership for the marketing and distribution of the PreHevbri vaccine in Europe.
- Gaztransport & Technigaz announced the approval of Ascenz’ electronic fuel monitoring system by Exxon Mobil.
- Neoen issued €300 million in “green” 2027 OCEANE bonds.
- Nanobiotix and lianbio announced the recruitment of the first patient in Asia for the phase III nanoray-312 trial, evaluating NTXBR3 in head and neck cancers.
- DBV Technologies has initiated a Phase III (SPEED) study of the modified Viaskin Peanut patch in peanut-allergic children aged 4 to 7 years.
- Buy-Rent repurchases its shares at a rate of 10,000 to 1.
- Financial Da Vinci acquired 7.24% of Cast for 7.55 EUR per share.
- Lhyfe concludes an agreement with Plug for the delivery of PEM electrolysers.
- Don’t Nod enriches its catalog with a new co-production in the action-RPG segment.
- CIOA Group reported several contracts signed in China on its platform.
- Altamir, SES-Imagotag, Jacquet Metals, Somfy, Boiron, Samse, Neurones, Sogeclair, Locasystem, Spineway, Invibes, Damartex, MyHotelmatch and Transgene published their accounts.
In the world
Important (and not so important) notices
- Apple unveiled a new iPhone and a serious sports watch. The terminals allow emergency messages through an agreement with satellite operator GlobalStar.
- Cineworld was placed under the protection of United States bankruptcy law with $1.9 billion in debts.
- Mitsui and Shell will explore the possibility of capturing carbon in the Asia-Pacific.
- Stora Enso bought a Dutch packaging company.
- Thoma Bravo will not bid for Darktrace.
- Skanska has secured a $422 million contract for the Portland International Airport expansion project in the United States.
- Tod’s sales grew 17% in the first half of 2022.
- Ypsomed has partnered with Berlin-based therapy app developer Sidekick.
- Main publications of the day: Taiwan Semiconductor, Mediatek, ZScaler, ICA Gruppen, Melrose Industries, Helvetia, Rubis, SES-Imagotag, Vistry… The whole agenda is here.