India's First International News Journal

20.4 C
Los Angeles
Wednesday, February 8, 2023

Wall Street optimism helps European markets limit losses

Wall Street rediscovered colors Wednesday, helping the European places to limit their losses after a very difficult beginning of week under the blow of the fears related to the spread of the new coronavirus In Europe.

“The opening in the green of the New York Stock Exchange helps European markets to recover a little,” noted AFP Daniel Larrouturou.

“They are also benefiting from a technical rebound, with a hunt for good deals on the titles most affected in recent days, including the automobile,” he added.

“But above all, there is great nervousness and the very brutal developments testify to the difficulties of investors in properly assessing the consequences of the epidemic,” he added.

Around 4:15 p.m. GMT, the Paris Stock Exchange lost 0.33%, after having fallen by more than 2% in the morning, that of Frankfurt rose 0.12% and that of London fell by 0.44%.

The day had started badly for European stock exchanges.

Despite the slowdown in the number of deaths in China, investors were fearful of the latest developments in the Covid-19 epidemic, which continues to spread around the world, and of the alert issued by the American control centers. diseases and their prevention (CDC).

U.S. health officials said Tuesday they expect the epidemic to spread to the United States, where Donald Trump’s chief economic adviser has downplayed its impact on the world’s largest economy.

The new coronavirus, which appeared on Tuesday in four new countries (Austria, Switzerland, Croatia, and Algeria), has contaminated since its discovery in late December some 78,000 people in China, of whom more than 2,700 have died.

In Europe, Italy is the most affected European country, with ten deaths and more than 300 people infected. Neighboring countries have however committed to keeping their borders open while the first Frenchman infected with the virus died on the night of Tuesday to Wednesday.

– In search of support measures –

For the time being, it is too early to assess the future trade impact of the health crisis and to assess the outlook for the situation. It is this uncertainty, abhorred by the markets, that weighs on equities.

“The markets look gray as they fear contamination from an increasingly large number of countries,” observes an analyst at La Banque Postale Asset Management (LBPAM).

In this context, the markets “call for support measures by the public authorities, the central banks in the first place,” writes LBPAM in a note.

However, many market players are questioning the effectiveness of a key rate cut to respond to a half-mast supply.

“Many companies, including Apple, Pernod Ricard, and the luxury sector have already warned that disruptions in the supply chain would impact their first-quarter performance,” said Franklin Pichard of Kiplink Finance.

To restart the machine, China has announced a vast plan to support small and medium-sized businesses asphyxiated by the epidemic, encouraging banks to grant them preferential loans.

Synthia Rozario
Synthia Rozario
An editorial staff member at The Eastern Herald. Formerly, correspondent of The Eastern Express, Hong Kong.

Public Reaction

Read More