Headless Italy, Singapore cancelled (?), Rising Dollar

Paris stock exchange should open on a moderate down.

Ten-years bond yields almost up to 3.07%

As the period of quarterly publications comes to an end, macroeconomics and geopolitics are the focus of market attention. The publication of statistics in the United States are indicating that household consumption is on a very positive trend – due to wage increases and tax reform – has rekindled inflationary pressures. Ten-year bond yields rose to almost 3.07%. However, at this point in the American economic cycle, this return of inflation seems to be under control and the risk of a stronger than expected tightening of the Fed’s monetary policy is not on the agenda.

us treasury bond up to 3.07%

A chance for Europe?

The consequence of this situation serves Europe well, which is benefiting from the euro’s retreat against the dollar, at a time when the IMF is concerned about the rise in protectionism that could penalize European economies. French companies, which were penalized by negative exchange rate effects in the first quarter, are expected to prosper in the coming months.

A difficult international context

However, geopolitical challenges are numerous. North Korea could reconsider its position on holding a summit with the United States on 12 June next. This is in addition to the very tense situation in the Middle East and the continuing trade dispute between China and the United States. It is very difficult today to assess the economic consequences of all these events. At the same time, the political situation in certain countries is likely to influence capital outflows from emerging countries such as Turkey. Everything is therefore converging towards a strong dollar.

Headless Italy

A real pandemonium according to the rumors between the League and the 5 stars movement which were however to announce their union and the name of the Prime Minister as of Monday.
They are “apparently”, I say well “apparently”, because everything changes from one day to the next, on the verge of breaking up. The cause? Europe. The boss of the League asks the boss of the 5-star movement to take stronger positions against Brussels and Europe. We’re starting the 11th week of negotiations. If there is no agreement, Italy will vote again.

Few corporate stocks

On the corporate side, Alstom published this morning solid annual results (2017-2018). The adjusted operating margin was 6.5% compared to 5.8% a year ago. The latter could reach 7% by 31 March 2019. In spite of everything, we remain away from the stock due to the merger of the group with the German Siemens.

CNP Assurances reported net income up 3.7% in the first quarter and confirmed its forecast of gross operating income up at least 5% in 2018. We are out of the stock.

LVMH almost reaching 300€. At Housewife Trading, we bought the stock at 245€.

On the agenda for today:

  • France: # number of company incorporation of April
  • Euro Zone:
    • April Inflation
    • Governing Council of the European Central Bank. No decision on rates.
  • US:
    • Building permits and project starts in April
    • Industrial production in April
    • Department of Energy Weekly Oil Stocks

 

Trade wisely and at your own risk

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