European stock markets are moving cautiously higher on Wednesday, as investors turn their eyes to the upcoming decision of the US Federal Reserve (Federal Reserve).
On the board, the pan-European Stoxx 600 is up 0.43%, with the banking sector leading gains with 1.1%, while the basic resources sector is down 0.7%. The other pan-European indicator, Eurostoxx 50up 0.62%.
The German DAX the French wins 0.37% CAC 40 0.40% and the British one FTSE 100 0.46%
In the periphery, the Italian FTSE MIB the Spanish is also strengthened by 1.08% IBEX 35 by 0.32%.
The general market belief is that the Fed will proceed with a second consecutive rate hike of 75 basis points.
The US central bank, like many of its counterparts around the world, is aggressively tightening monetary policy in order to tame inflation, although in doing so it is simultaneously putting a “brake” on economic activity.
Worries about the global economy deepened on Tuesday after the International Monetary Fund revised its global growth forecasts for both 2022 and 2023, citing “a gloomy and uncertain outlook”. “.
The IMF now expects the global economy to grow at a rate of 3.2% this year and 2.9% in 2023, revised up by 0.4% and 0.7% from its previous forecast in April.
The day’s corporate results include those of Credit Suisse and Deutsche Bank reporting as well as Daimler, Danone, Carrefour and Airbus.
Credit Suisse has appointed asset management specialist Ulrich Koerner as its new chief executive as part of a strategic overhaul announced by the Swiss bank as it tries to recover from a series of scandals.
Pressure had been mounting for months on current chief executive Thomas Gottstein over scandals and losses that have sprung up during his two-year tenure, which have battered stocks and angered investors.
Investors have been calling for Gottstein to be replaced in recent months, but the bank has resisted.
News of the strategic review, which will further hit investment banking businesses, comes as Credit Suisse reported a loss of 1.59 billion francs ($1.65 billion), below analysts’ estimates.
Deutsche Bank reported a better-than-expected 51% rise in second-quarter profit as investment banking revenue rose, although the bank was less bullish on the unit’s full-year outlook and issued a financial outlook warning .
The results come in a week of reports by almost all major banks in Europe, where investors are watching for signs that a weaker economy, higher interest rates and the war in Ukraine are affecting their operations and outlook.
Germany’s banks are at the center of a geopolitical storm because the country is highly dependent on Russian energy and its economy would be hit hard by any supply shortages.
Net profit came in at 1.046 billion euros, up from 692 million euros a year ago, and better than estimates of 788 million euros.
On the macroeconomic front, consumer confidence in Germany is expected to fall to a record low in August, as fears of dwindling gas supplies and pressure on supply chains, combined with the war in Ukraine, create a decidedly volatile landscape. .
The index of the GFK Institute shortly before its change was at -30.6 points, a historic low compared to the previous, also negative record of -27.7 points at the beginning of July.
Source: Capital
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