(Paris) Stock markets were pleased with US jobs figures for December on Friday, pointing to wage growth at the lowest since August 2021, which could lead the Federal Reserve to ease its monetary tightening .
In Paris, the star CAC 40 index rose 1.47% to 6860.95 points, its highest closing since the start of the war in Ukraine. London ended up 0.87% to a 3-year high and Frankfurt gained 1.20%, its balance for the week approaching 5%.
While European indices have focused this week on the reopening in China and lower energy prices, on Wall Street investors are instead trying to see how far the Federal Reserve will raise its rates.
The Dow Jones gained 1.62%, the broader S&P 500 index advanced 0.61% and the NASDAQ index 1.71% by 12:25 p.m. (Eastern time).
The US unemployment rate fell to 3.5% in December, a sign of the resilience of the labor market, but what was especially exciting was the slow rise in the average hourly wage (+4.6% compared to to December 2021, compared to +4.8% in November).
Analysts believe that the slowdown in wage increases is likely to ease inflationary pressures and ease the foot of the US central bank, which has been raising the cost of credit since March to curb consumption and thus curb inflation.
“Such wage growth is still too high to be inconsistent with the Fed’s 2% inflation target. But the optimists among us will likely find some support in the thesis that the Federal Reserve may be on the verge of not raising interest rates much more,” according to Christian Scherrmann, economist at DWS.
Economic activity in services contracted in December in the United States for the first time since May 2020, according to the index of the professional federation ISM.
“The economic slowdown is not reflected for the moment by a deterioration of the labor market”, observes Christian Parisot, economist of the broker Aurel BGC.
The employment situation is one of the main elements taken into account by the American central bank (Fed) to assess the health of the country’s economy.
“It remains to be seen what the Fed will favor: maintaining the credo of an overheated job market with an unemployment rate that is still too low, or that of an easing of inflationary risks for lack of seeing any price spiral. wages ? asks economist Véronique Riches-Flores.
The bond market also reflected hopes for a more lenient Fed in the coming months.
The yield on 2-year US government bonds, which are supposed to better reflect monetary policy expectations than 10-year bonds, eased to 3.58% from 4.45% the day before.
On the side of oil and currencies
The dollar was widening its losses on Friday, with US jobs numbers for December pointing to a slowdown in wage increases, easing inflationary pressures and opening the door for a slower rate hike from the Federal Reserve (Fed ).
Around 12:25 p.m. (Eastern time), the greenback lost 0.96% to 1.0624 dollars for the euro, after having reached before the publication of the report a high for almost a month at 1.0497. dollar.
Oil prices were on the rise again, after a week in sharp decline: the barrel of Brent from the North Sea for March delivery rose by 1.02% to 79.49 dollars, that of the American WTI at maturity February was up 1.30% at $74.94 around 12:30 p.m. EST.
The price of European wholesale natural gas fell 3.98% to 69.53 euros per megawatt hour.