Wall Street rises on hopes of Fed easing

Chinese markets are suffering the day after third term granted to Chinese President Xi Jinping but this headwind is not strong enough to bend Europe, driven higher by the American markets.

Chinese markets were in the red, in particular Hong Kong which fell by 6.5% in the last exchangesat its lowest level since 2009. Investors are particularly concerned about the Chinese President Xi Jinping’s decision to entrust key economic positions to his allies who support the “zero Covid” policyheld responsible for the sharp drop in growth in the world’s second largest economy.

Additionally, tech companies, which feature heavily in the index, have been hit in recent years by Xi’s crackdown on the sector, which has squeezed profits and lost billions of dollars in market valuation. The Shanghai Stock Exchange fell by 2.02%.

In contrast, the Tokyo Stock Exchange took 0.31%, carried by Wall Street, which ended up sharply on Fridayaround 2.4% for the three main indices.

This American momentum, accelerated after the close of European markets on Friday, also benefits stock market Europe in the first exchanges: Frankfurt rose by 0.36%, Paris takes 0.48% but the London stock exchange yields 0.43%. The Euro Stoxx 50 gained 0.38%.

The news of the week is going to be extremely busy for the marketsbetween the peak of company publications in Europe and the United States and the European Central Bank meeting on Thursdaybefore that of the American Central Bank at the beginning of next week.

The hope that the Fed is initiating, at least in its speech, the hypothesis of a change of gear after the numerous and painful hikes in its main key rate this year, in order to bring inflation back under control, supported equities. .

We are entering perhaps the sixth attempt this year of the rebound on the Fed pivot hypothesis, the first five having ended in failure.

Deutsche Bank analysts

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