Wall Street is expected to be in the red, mirroring the trend on European stock markets midway through trading on Friday, while bond yields are rising as strong macroeconomic data in the US fuels fears that the Federal Reserve will continue to raise interest rates. Futures contracts on New York indices reported a decline of 0.55% for the Dow Jones, 0.68% for the Standard & Poor's-500 and 0.87% for the Nasdaq. In Paris, the CAC 40 lost 0.81% to 7,306.82 at 12:04 GMT, moving away from the previous day's all-time high of 7,387.29. In Frankfurt, the Dax fell by 1.1%, and in London, the FTSE by 0.33%.

The pan-European FTSEurofirst 300 index fell by 0.73%, the Eurozone EuroStoxx 50 by 1.07% and the Stoxx 600 by 0.72%. The latter posted its first decline of the week.

On Thursday, market players took note of the fact that US producer prices rose in January at their fastest pace in seven months, and that a surprise drop in jobless claims was reported, testifying to the tenacity of inflation and the strength of the labor market.

Shortly after the release of these indicators, two Fed officials, Loretta Mester and James Bullard - who are not voting members of the committee this year - said that the US central bank probably should have raised rates further in early February.

"Data in the US continues to suggest that the economy is in better shape than many had expected, fueling expectations that the Fed will need to tighten policy further beyond the current quarter," said Mark Haefele at UBS Global Wealth Management,

Goldman Sachs has revised upwards its expectations for US rates, now forecasting three further hikes this year (in March, May and June), of a quarter-point each time.

VALUES IN EUROPE

Hermès is down 0.46% despite solid quarterly results, with analysts suggesting that the share's recent performance suggests that most of the good news has already been priced in.

Teleperformance lost 2.70% after reporting lower-than-expected quarterly sales growth and full-year profit.

On the upside, Air France-KLM gained 5.95% and Ubisoft 3.99% following the publication of good results and forecasts.

RATES

The yield on ten-year US Treasury notes, at 3.8921%, the highest since the end of December, posted its fourth session of gains, a move favored by a series of solid statistics that prompted investors to reassess the levels at which global interest rates would peak.

In Europe, yields on benchmark government bonds followed suit: the German ten is at 2.511%, up around three basis points, and the French OAT of the same maturity is approaching 3%.

The yield on the two-year Bund, more sensitive to rate expectations, reached its highest level since October 2008 at 2.943%.

FOREIGN EXCHANGE

For the same reasons, the dollar appreciated by 0.7% against a reference basket. The euro fell to $1.0622, its lowest level since January 6.

OIL

The oil market fell by more than 2% and is heading for a negative weekly performance on the prospect that the Fed's monetary tightening will intensify and curb demand.

Brent crude lost 2.78% to $82.77 a barrel, and West Texas Intermediate (WTI) 2.94% to $76.18.

NO MORE MAJOR ECONOMIC INDICATORS ON TODAY'S AGENDA

(Laetitia Volga, edited by Kate Entringer)

by Laetitia Volga