Wall Street plugs after China and Citigroup

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WALL STREET ENDS UP

by April Joyner

NEW YORK (Reuters) – Wall Street ended on a solid note Monday following its historic highs last week, following mixed economic indicators in China and unconvincing results from Citigroup.

The Dow Jones index gained 27.13 points, or 0.10%, to 27.359.16. The larger S & P-500 gained 0.53 points, or 0.02%, to 3.014,30. The Nasdaq Composite advanced 13.69 points (+ 0.17%) to 8.257,84 points and released its fourth consecutive closing record.

China's gross domestic product (GDP) growth slowed in the second quarter to 6.2% on an annual basis, at 27, against a backdrop of trade tensions with the United States. But industrial production and retail sales in June were better than expected.

With the start of quarterly results – Citigroup and other leading US banks in the lead – investors should remain cautious, says Oliver Pursche, head of Bruderman Asset Management strategy.

The three major indices ended last week at record levels, driven by statements by Fed Chairman Jerome Powell that raised hopes that the central bank would decide to cut rates for the first time in 10 years.

"We are certainly in a wait-and-see period," he said. "If the results are better than expected, we could have a second upward phase."

VALUES

Banking activity declined in the wake of Citigroup (-0.06%), whose results are difficult to convince. The bank, which started the second quarter publications, reported better profits than expected, but a slight contraction in net interest income.

JPMorgan Chase, Goldman Sachs and Wells Fargo lost 1.1% to 1.4% on the eve of their results.

The index of banks fell by 1.04%.

Boeing has lost 1.01%, one of the Dow's worst downturns, in response to a Wall Street Journal report that the 737 MAX may not run until 2020.

Symantec has lost 10.68%. According to sources familiar with the issue, the IT security specialist has concluded negotiations for the sale to Broadcom's semiconductor manufacturer (+ 1%), disagreeing about the price.

INDICATORS OF THE DAY

At the macroeconomic level in the United States, manufacturing activity in the New York area rebounded more sharply than expected in July after the interruption of the previous month, according to the monthly survey of the regional antenna of the United States. Federal Reserve. His "Empire State" index rose to +4.3 after his plunge in June to -8.6.

THE SESSION IN EUROPE

European stock markets ended on their side in the green, investors mainly remembered that the slow growth of the second quarter was in line with expectations and other official statistics, for the month of June, signal a stabilization of the second world economy .

In Paris, the CAC 40 closed 0.10% at 5,578.21 points, after rising to 5,606.68. The British Footsie gained 0.48%, after seven sessions of decline in a row, and the German Dax of 0.52%. The EuroStoxx 50 index advanced by 0.25%, the FTSEurofirst 300 by 0.32% and the Stoxx 600 by 0.36%.

European markets briefly switched to red at mid-session in reaction, according to market participants, to a cautious economic outlook in Germany.

RATE

After opening at a one-month high of 2.15%, supported by Chinese statistics, 10-year Treasury yield has stabilized at around 2.10%, pending retail sales figures . which will be published Tuesday.

European sovereign bonds benefited from a return after last week's strong sales boost. Yields therefore fell overall in the euro area from 5 to 10 basis points, bringing Italian rates to the lowest levels of the last 10 days.

The yield of the 10-year German Bund closed at -0.29%, up from -0.224% compared to the maximum of three and a half years, as data on industrial production and inflation in Europe suggested that pessimism about growth is exaggerated.

EXCHANGE

On the foreign exchange market, the changes are limited to the approach of this month's monetary policy meetings, which should see the European Central Bank (ECB) and the US Federal Reserve (FED) confirm their accommodating inclination.

The dollar index gained 0.13% compared to a basket of reference currencies, including the euro, which fell to 1.156.

In a tight market this summer, the upward trend in the US dollar is mitigated by expectations of a 25 basis point drop in Fed rates next week, followed by another in September.

OIL

Crude oil prices are receding after mixed Chinese indicators and signs of the impact of the tropical storm on production and refining in the Gulf of Mexico.

Brent produces 0.85% at 66.15 dollars a barrel and US crude oil loses 1.56% to 59.27 dollars.

THINGS TO LOOK FOR TUESDAY:

The day will be enlivened by numerous indicators on both sides of the Atlantic, including the ZEW index of investor sentiment in Germany and June retail sales figures in the United States.

Earnings announcements will continue, including those of JP Morgan, Goldman Sachs and Johnson & Johnson prior to the opening of Wall Street.

(Juliette Rouillon for the French service)

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