MARKET REVIEWS. Comments from the Bank of England on UK developments and inflation are causing turmoil in the markets, which do not show a clear trend on Thursday and are awaiting a new inflation indicator in the United States.

Stock market indices at 8:30 a.m.

Dow Jones futures fell 101.00 points (-0.30%) to 33,501.00 points. S&P 500 futures fell 3.00 points (-0.07%) to 4,149.00 points. Nasdaq futures gained 25.75 points (+0.19%) to 13,435.25 points.

In London, the FTSE 100 fell 25.68 points (-0.33%) to 7,715.65 points. In Paris, the CAC 40 rose by 16.06 points (+0.22%) to 7,377.26 points. In Frankfurt, the DAX fell 21.48 points (-0.14%) to 15,874.75 points.

The context

The BoE has, as expected by analysts, raised its rates by 0.25 percentage point in an attempt to stem inflation, a 12th consecutive increase which takes its key rate to 4.5%, the highest since October 2008.

Elsewhere in Europe, Paris advanced by 0.30%, Frankfurt fell by 0.10% and Milan by 0.41%.

The New York Stock Exchange looks to be in loose order around the opening equilibrium according to the futures contracts of the main indices.

In Asia, the Tokyo Stock Exchange ended stable (+0.02%). Hong Kong fell 0.09% and Shanghai 0.29%.

For the coming months, the BoE has indicated, as in February and March, that hikes will be necessary “if inflationary pressures persist”.

Economists at the British monetary institution raised their inflation projections to 5% in 2023, before seeing a slowdown to 2.25% in 2024 and then to 1% in 2025.

The BoE now judges that the UK will avoid recession and that the economy will not contract in any quarter in 2023 or 2024.

On Wednesday, the slight slowdown in US inflation in April over one year was not enough to restore real momentum to the markets.

Thursday will be published producer prices for April in the United States, which are expected to slow down, to +2.4% year on year against +2.7% in March, according to analysts polled by the data provider Factset.

“As a leading indicator of the consumer price index, this should reinforce the idea that inflation will fall further, but that does not mean that the Federal Reserve will be inclined to cut rates as soon as this year, especially given the labor market that remains resilient and wage growth that continues,” commented Michael Hewson, analyst at CMC Markets.

In China, the situation is quite different: the consumer price index hit its lowest level in more than two years in April, just above 0%, and producer prices fell further. in deflation, a sign of sluggish domestic demand and lower commodity costs.

In addition, the lack of progress on the US debt ceiling file is pushing investors to be cautious.

Among today’s results

The German chemist Bayer (-6.30% in Frankfurt) published a net profit down sharply by 33.8% in the first quarter, due to the drop in sales of certain drugs and the fall in glyphosate prices.

Dutch bank ING saw its net profit almost quadruple in the first quarter year on year, climbing to 1.59 billion euros, boosted by rising interest rates. Its action gained 3.60% in Amsterdam.

The British industrial group Rolls-Royce has warned that difficulties persist in its supply chain in the first quarter. Its action fell 5.60% in London.

German industrialist Thyssenkrupp (-2.55% in Frankfurt) recorded a net loss of 203 million euros over one year during its second quarter due to the fall in the price of steel.

On the oil side

Oil prices fell slightly. The barrel of American WTI yielded 0.36% to 72.27 $US and that of Brent from the North Sea fell 0.05% to 76.37 $US.