We have the Fed on Wednesday, then the ECB, the Bank of England and the Swiss National Bank on Thursday. The latest data shows that inflation is moderating and that a soft landing is possible. At least that is the prevailing view. But it is a fragile trend, as demonstrated by the hesitation of stock market indexes on Wall Street. These hesitations are fueled by conflicting statistics that make it difficult to understand if and how fast prices are cooling. Let's just say that the majority of economic data is now pointing to a slowdown in inflation, but a few divergent indicators are keeping the suspense alive for the market, which is only dreaming of one thing: that money will become cheap again.

Around these monetary policy decisions, there will be a number of events likely to create volatility. The consumer price index in the United States in November on Tuesday, before the Fed's decision. But also, the US retail sales in November, published on Thursday. We will also have on Friday the first PMIs for December and the last clearing session of the year, called Witching Day, which sees index and equity derivatives expire. In short, there will be plenty to see.

Consumer inflation data tomorrow is expected to show prices gained 7.3% in November on a yearly basis, down from a 7.7% rise recorded in October, while the core rate should decline to 6.1%, after 6.3% in October.

As we approach the end of the year, we can start to look back at the performance of indexes this year on a global scale. The United Kingdom (+1%) has done better than holding its own despite the current political turmoil, while Australia, Japan and Spain have lost less than 5% since 1 January.

The Nasdaq 100 is still at the bottom of the league at -29%, after the bursting of the speculative bubble in tech stocks. European mid-caps are also paying a heavy price for 2022, with the German MDAX and the SMI Mid falling by around 27%. The MSCI World Index is down 18%, just behind the investor benchmark, the S&P500 (down 17%).

Meanwhile, since January 1, India is up 6.5%. The Bombay Stock Exchange has an average annualized return of 14.1% over 10 years, thanks to the development of the Indian economy, a powerhouse in the making. The rise continues this year, even if it is below average.

Norway, Portugal: +3%. These two markets are dominated by energy stocks. The Lisbon Stock Exchange also benefited from its quota of packaging stocks. Brazil's main index is up 2.5%. The Bovespa benefited greatly from the presence of large energy stocks, raw materials and banking among its major capitalizations.

This morning, U.S. stock index futures open in the green, after Treasury Secretary Janet Yellen said yesterday that she sees a substantial reduction in US inflation in 2023.

 

Economic highlights of the day:

Not much to look forward to today, apart from the UK monthly GDP. All the macro agenda is here. Japan announced this morning higher than expected producer prices in November.

The dollar is down 0.3% against the euro to EUR 0.9471 and down 0.2% against the pound to GBP 0.8149. The ounce of gold has lost some ground to 1787 dollars. Oil is slightly up, with North Sea Brent at USD 77.82 a barrel and U.S. light crude WTI at USD 73.15. The yield on 10-year US debt is sailing around 3.56%. Bitcoin is trading around 17,000 dollars.

 

In corporate news:

* Amgen announced Monday that it has bought biotech company Horizon Therapeutics for about $26.40 billion, its largest acquisition to date. Sanofi had announced on Sunday that it was no longer in discussions with the American biotech. Horizon shares jumped 12.1% in pre-market trading.

* Microsoft will take a 4 percent stake in the London Stock Exchange Group as part of a 10-year commercial agreement to move the exchange operator's data platform to the cloud, the British company announced Monday. Microsoft shares were up 0.4% in pre-market trading.

* Boeing - Air India, owned by Indian conglomerate Tata Group, is close to placing a landmark order for at least 500 aircraft from both Airbus and Boeing, worth tens of billions of dollars, industry sources told Reuters on Sunday.

* Apple gained 0.3% in premarket trading as intermediary Evercore ISI reported that delivery times for iPhone Pro models have fallen to 22-26 days in all geographies it tracks except Japan, while demand remains strong.

* Coupa Software jumped 22% in pre-market trading after news reports that private equity firm Thoma Bravo is in advanced discussions to buy the software company after outbidding Vista Equity Partners.

* Rivian Automotive announced Monday that it plans to suspend its joint venture with Mercedes-Benz Vans, just three months after entering into a partnership with the German carmaker to produce electric vans in Europe. Rivian is down 3.5% in pre-market trading.

* Clovis Oncology - The U.S. pharmaceutical company, which specializes in cancer treatments, filed for bankruptcy on Sunday due to a drop in sales and difficulties in raising new capital.

 

Analyst recommendations:

Accenture - Piper Sandler lowered its recommendation to "underweight" from "neutral".

Box - JP Morgan raised its recommendation to "overweight" from "neutral".

Oracle: Jefferies is keeping its Neutral rating. The target price is reviewed upwards from USD 75 to USD 85.

Qualcomm: Wells Fargo downgraded Qualcomm to Underweight from Equalweight, keeps Price Target at $105

Norfolk Southern: RBC raises the price target  to $253 From $237, Maintains Sector Perform Rating

Union Pacific: RBC raises PT to $200 From $187, maintains Underperform rating.