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(Il Sole 24 Ore Radiocor) – Positive week for Piazza Affari, which leads the European stock markets with a rise of 1.1% together with Madrid (+1.3%), in an eighth marked by the meeting of the Fed and the ‘postponement of the interest rate cut. After Wednesday’s words from President Jerome Powell, accompanied by better-than-expected data on the US labor market, traders have practically lost hopes of a breakout as early as March. Meanwhile in the Old Continent inflation began to fall again with an annual rate of 2.8% in January. Thus, Paris, Frankfurt and London closed the first week of February just below parity while the Euro Stoxx 600 index remained flat.
Purchases were concentrated on the European auto sector (+5.1%). In Milan, Ferrari turbocharged with an increase of 11% in the week of the presentation of record results and the announcement of Lewis Hamilton’s arrival in the Maranello team. In second place, Stellantis (+8.8%) also supported by the government’s openness to state entry into the capital. Positive eighth also for Iveco (+5.4%). The best also include Bper (+4.6%) and Bpm (+4%), while the worst performance is that of Saipem (-12.9%), followed by Finecobank (-7.2%).
Weak closing for the February 2 session
European stock markets close weak, reducing initial gains. Cooling the Old Continent are American employment data, which despite showing a strong labor market, reduce the probability of an imminent rate cut by the Fed.
Milan’s Ftse Mib thus closed at +0.09%, with the spread slightly decreasing to 157 basis points (from 158 at the closing the day before), while the yield of the benchmark ten-year BTp increased to 3.80%, from 3, 72% of the previous close. Also on parity are the Cac of Paris (+0.05%), the Dax of Frankfurt (+0.35%) and the Aex of Amsterdam (+0.05%). Pink jersey for Ibex of Madrid (+0.49%).
US employment better than expected, interest rate cut hypothesis receding
US employment data indicates a strong job market: 353,000 jobs were created in January (excluding the agricultural sector), exceeding expectations. Unemployment remained stable at 3.7%, against expectations for a rise to 3.8%. Average hourly wages increased 19 cents. Traders have now abandoned the long-held hope of an interest rate cut in March, given the strength of the labor market, which will allow the Fed to continue to keep rates at 5.25%-5.50% for bring inflation down towards the 2% target. The Cme FedWatch Tool assigns only 19.5% chance of a cut in March, compared to 38% on the eve and 70% in January.