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The indices are shaking on Wall Street

Markets hesitated Tuesday on Wall Street, the day after a difficult session. After a series of highs, the indices are now moving down, with the exception of the Dow Jones, which is doing very well. The season of the results of the quarter – which will enter into many things on Thursday with the main banks of America – and the publication on Wednesday of the most important data on inflation in the United States encourages investors to be cautious, amid fears of a recession.

The Dow Jones gained 0.33% to 31,283 points but the broader S&P 500 fell slightly by 0.08% to 3,851. The Nasdaq lost 0.27% to 11,343 points.

European markets have also been volatile but have generally returned to higher levels. In Paris, the CAC 40 is back in the green and gains 0.55% to 6,029 points at 5 p.m. In Frankfurt, the Dax advanced by 0.17% and in London, the Footsie is now stable. Madrid and Milan are losing.

The ball of results has begun

Earnings season begins on Thursday with major US banks due to report their second quarter performance. Beverage giant PepsiCo got the ball rolling on Tuesday, raising its annual forecast for demand for sodas and other “diet” products, despite rising prices. Packaged food manufacturers have so far been relatively unscathed by rising prices, especially in the United States, where consumers tend to spend on meals on wheels rather than eating out.

Companies have cut their outlook for the quarter, but investors are worried they may face this, and more importantly, their outlook for the time being around rising prices. Total earnings for the S&P 500 are expected to rise 5.7% in the April-June period, according to Refinitiv data, down from the 6.8% expected at the beginning of the quarter.

An alert is also due to be published on Wednesday for new data on consumer prices in the United States. A recent stronger-than-expected U.S. economic report boosted hopes for a second consecutive Federal Reserve hike of 75 basis points at its next meeting on July 26-27. These aggressive measures by the central bank are leading to fears that the economy will collapse.

The dollar stabilizes, putting pressure on oil

The dollar is almost stable against the basket of currencies (+ 0.05%) after a new hit since October 2002. The euro, still under pressure, almost reached close to the dollar during the session, at 1.00005, its lowest level. since December 2002, before returning to 1.0054 (+ 0.15%), due to uncertainty over ECB rates and the risk of a recession in the euro area. The decline in European currencies accelerated this morning with the publication of the German ZEW’s lowest level of business sentiment.

Oil prices are affected by the strength of the dollar and the prospect of a decrease in the demand for health care in China and the risk of a global recession. OPEC is forecasting slower growth in oil demand in 2023, in its monthly report released on Tuesday.

The barrel of Brent yields 6.6% and returns to 100 dollars and American light crude (West Texas Intermediate, WTI) has fallen 6.8% to 97 dollars.

China is still being monitored

Several Chinese cities have imposed new restrictions in an attempt to stop the spread of the virus that causes the disease, the COVID-19 BA.5 Omicron subvariant. About 30 million people in the country have other travel restrictions.

Behavior

Pepsico takes 1% for Tuesday’s increase in its annual sales.

The difference fell more than 6%, after the warning of its margins in the second quarter due to the rise in costs and the announcement of the departure of its chief executive Sonia Syngal.

Apple earns 1.2%. A Moscow court on Tuesday will fine the American group two million rubles (33,867 euros) for refusing to store the information of Russian citizens on Russian territory, the Interfax news agency reported.

Twitter did 2.4% after falling more than 11% on Monday. The group denied on Monday evening Elon Musk’s accusations of not honoring their contractual obligations. On the social network, the billionaire “knowingly” broke the agreement to take over the social network for 44 billion dollars (43.9 billion euros).

American Express is stable, while Jefferies and Credit Suisse lowered their price targets.

Peloton Interactive jumped more than 3% after it said it would stop making its bikes and treadmills to streamline operations and cut costs.

Dollar General gained 0.3%. The sales team announced Tuesday the departure of its general manager Todd Vasos.

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