A surge of more than 2% on the Paris Stock Exchange on Wednesday would be very ephemeral. The Cac 40 fell sharply again on Thursday, gaining 2.29% early in the morning to 6125.60 after a disappointing finish in New York where the Dow Jones shed 1.02% and the Nasdaq Composite shed more than 3%. .
Consumer prices published yesterday confused investors. Inflation for the year was 8.3%, as expected, below March’s 8.5%, a 40-year peak, but above the 8.1% expected by consensus. Enough to prove that both optimists are right – but perhaps even more right than the pessimists, given the evolution of Wall Street last night – regarding the evolution of prices in the country …
“Cost of Living Crisis”
Core inflation of 6.2% in April means, according to Allianz chief economic adviser Mohamed El-Erian, that there are many factors that now come into play when setting prices. it’s only a matter of time before we talk about the cost of living crisis. It is no longer only about the war in Ukraine, but also about the process of large-scale inflation, with which the Fed has lagged behind in management.. » Delay that may need to be offset by more aggressive rate hikes than just a 50 basis point hike federal funds at future FOMC meetings.
On the other hand, for Véronique Riche-Flores, an economist at Riches-Flores Research, ” this report certainly increases the chances that the peak of inflation in the US is behind us. (…) She notes an 18.5% rise in airfares in one month, the largest increase in the index to date, without which the core indicator’s monthly rise would have been 0.4% instead of the 0.6% that markets hadn’t hoped for. possible easing of interest rate tensions (…) Rising prices for goods or entertainment services, for example, are about half what they were two or three months ago. Clothing prices fell 0.8%. Particularly feared after what has been seen in the real estate market, rent increases are not speeding up in a ostentatious manner. “.
This afternoon, at 14:30, operators will monitor producer prices. A slight decline is also expected here, at a notoriously high 10.7% for the year, but less than the increase to 11.2% in March. ” The PPI has been showing signs of leveling off for several months, just above 10% for the year. Recent price stabilization could lead to slight pullback Oddo BHF said at the beginning of the week. It is expected to rise 0.5% for the month against 1.4% in March and 0.6% on the basis (excluding food and energy) against 1% in March.
Veolia “ahead” in the first quarter
From the business side Bouygues (-1.2%) posted accounts of 8.2bn at the end of March, up nearly 6% on an operating income loss of 77m, stable for the year but less strong than analysts had feared. Annual forecasts are maintained.
Veolia Environment (-1.7%) benefited from the integration of Suez, but at the same time posted organic growth of almost 8% in the first quarter. The Environmental Services Group reaffirms its goals” solid organic growth during the year and from 4% to 6% of its gross operating income, as he said: early in the first trimester.
As part of the Investor Day STMicroelectronics (+0.2%) indicated that it is aiming for a turnover of over $20 billion in 2025-2027 with a gross margin of around 50%.
With the exception of the flagship index, Ubisoft announced that it wants to return to growing its turnover in 2022-2023 after recording a decline in revenue (-5%) and operating income (-13.0%) during the fiscal year ending March. But it will take a little longer to restore the results. The stock lost just over 3%.