On the eve of the US employment report, European stock markets are expected to rise. The Eurostoxx 50 opens at 3,447.72 points (-1.05%), the CAC 40 at 5,985.46 points (-0.90%), the DAX 40 at 12,517.18 points (-1.21%), the FTSE 100 at 7,052.62 points (-0.48%), the SMI at 10,477.69 points (-1.07%), the AEX at 664.45 points (-0.77%), the BEL 20 at 3,446.50 points (-0.93%), the IBEX 35 at 7,579.90 points (-1.52%), the DJIA at 30,273.87 points (-0.14%), the Nasdaq at 11,148.64 points (-0.25%), the S&P 500 at 3,783.28 points (-0.20%) and the Nikkei 225 at 27,388.20% 39 points (+0.99%).

In terms of exchange rates, the change from the close mentions that in New York, EUR/USD is at 0.9917 (+0.32%), EUR/JPY at 143.33 (+0.21%) and USD/JPY at 144.54 (-0.11%).

On Thursday, 06 October 2022, Airbus is organizing a press briefing on the prospects for its services business for the aviation sector. For its part, Valneva is participating in an event for investors.

The National Institute of Statistics and Economic Studies presents its latest economic outlook on the macroeconomic front.

While investors await the US payroll employment figures, which will be published on Friday, October 7, and remain attentive to the statements of central bankers, the main European equity markets are expected to open in the green on Wednesday, October 5, 2022. According to data from the IG Markets broker, the CAC 40 futures contract increased by 78 points, or 1.3%. The FTSE 100 contract gained 50 points, or 0.7%, and the DAX 40 contract gained 177 points, or 1.4%.

On the night of Wednesday, October 5, 2022 to the present day, Raphael Bostic, president of the Federal Reserve (Fed) in Atlanta, estimated that the American central bank should raise its policy rate between 4% and 4.5% by December and then pause. Governors Lisa Cook and Christopher Waller will take their turn to speak on Thursday, October 06, 2022. For its part, the European Central Bank (ECB) will publish at 13:30 the minutes of its last monetary policy meeting, after which it raised its key rates by 75 basis points.

Similarly, on the same day, Prague is the place for dialogue and cooperation between states that was chosen to welcome the leaders of 27 countries of the European Union and 17 other countries of the Old Continent for the first summit of the “European Political Community”. The next day, the meeting will be followed by an informal European Council devoted to the war in Ukraine, the energy crisis and the economic situation. “The change in the fiscal path will bring public debt to 109% of gross domestic product (GDP) by 2024 from an estimated 101% for 2022, reflecting both higher primary deficits and lower growth prospects.

This year, inflation in the United Kingdom will average 8.9% according to Fitch before gradually decreasing to 4% in 2024. After its rebound at the beginning of the week, Wall Street paused on Wednesday, October 5, 2022, ending slightly lower after a volatile session. The expanded S&P 500 index and the Nasdaq Composite dropped 0.3% each and the Dow Jones Index (DJIA) fell 0.1%. The main indices present a mixed picture on Thursday, October 06, 2022 in Asia. The Nikkei index increased by 0.9% while the Hang Seng Index on the Hong Kong Stock Exchange fell by 0.2% following a jump of 5.9%. Due to China's National Day, Chinese stock exchanges are closed.

On Wednesday, October 5, 2022, US Treasury bond yields rose Wednesday, reflecting strong private-sector employment in September, encouraging investors that the Federal Reserve can still raise interest rates. According to CME's FedWatch tool, showing that investors believe rates should be between 4.5% and 4.75%, or even higher, by March 2023, the probability of a further 75 basis points increase in the federal funds rate in November is in a range of 3.75% to 4%, and is now estimated at around 65%.

Senior analysis at City Index, Fiona Cincotta believes that “Some of the statistics published earlier this week had fuelled hopes that the Fed would adopt a less restrictive monetary policy, but the market seems to have come to its senses. With inflation more than four times higher than the 2% targeted by the Fed and a labor market that is still dynamic, a more accommodative turn is not for tomorrow.”

The euro remains below parity against the dollar, but is gaining ground. Rabobank warns that the Fed, for its part, maintains a restrictive position and the persistent energy crisis in the eurozone and the single currency could remain weak in the short term. For the Dutch bank, American central bankers continue to report further substantial rate hikes, so it is premature to expect a significant reversal in the dollar.

Also, Rabobank indicated that the euro does not have the same safe-haven status as the dollar and is therefore more sensitive to recession fears, but the ECB is also seeking to fight inflation. In addition, she points out, the euro has “not yet fully integrated the energy crisis that the [eurozone] is facing and which is likely to continue for several years.”

Still supported by the reduction in production quotas announced on Wednesday, October 5, 2022 by OPE+, a group bringing together the Organization of Petroleum Exporting Countries (OPEC) and ten allied countries led by Russia, oil futures rose slightly the next morning. The November contract on light sweet crude (WTI) traded on Nymex advanced 3 cents to $87.79 per barrel, while the December contract on North Sea Brent rose 4 cents to $93.41 per barrel around 7:30am.