The Paris Stock Exchange is teetering around a balance divided between Jerome Powell’s encouraging announcement and escalating geopolitical tensions. The Ukrainian delegation is also due to travel to Belarus for a second meeting with Russian emissaries. Meanwhile, the rise in oil prices continues amid fears of supply disruptions.
On the Old Continent, growth in eurozone activity rebounded in February, but prices charged hit record highs. The IHS Markit composite PMI index (synthesis between industry and services) in the final data was 55.5 points after 55.8 in the first assessment and 52.3 in January.
At 10:20 am, Bedroom 40 lost 0.20% to 6485.15 points with a business volume of 860 million euros.
A barrel of Brent oil from the North Sea is flirting with $120 after touching 119.84, the highest level since May 2012. It’s up 20% in a week. Other commodities, from natural gas to aluminum, are being spurred on by tightening Western sanctions against Russia. In Paris, Total Energy occupies 0.7%. Technip Energies for its part grew by 9.6%. The band says it has stopped work on ” new business opportunities in Russia “. ArcelorMittal added 3.9%, still driven by rising iron ore prices in anticipation of a recovery in demand in China.
Powell for 25 basis points up
The president of the US Federal Reserve confirmed on Wednesday before a committee of the House of Representatives the central bank’s intention to normalize its monetary policy, while calling for an increase in the Fed’s capped 25 basis point funds rate in March. Wall Street took the opportunity to offer a sharp rebound of almost 2% on Wednesday evening, dragging Asian markets with it this morning.
Jerome Powell also pointed out that the war between Russia and Ukraine worsens the prospects for the American economy. highly uncertain adding that the Fed will be monitoring the situation closely. However, he warned that the central bank may have to act more aggressively if inflation continues to pick up.
It was inflation that prompted the Bank of Canada to raise its key rate by 25 basis points to 0.5% on Wednesday. The European Central Bank is also grappling with rising consumer prices, which reached a record 5.8% year-on-year in the eurozone in February.
Russian stocks excluded from major indices
Russian stocks will be excluded from all FTSE Russel indices, while MSCI has done the same with its popular emerging markets index. In addition, Fitch downgraded Russia’s credit rating by six notches to junk. Moody’s followed suit and joined Standard & Poor’s.
While a Ukrainian delegation is reportedly on its way to Belarus for further talks, Kyiv has confirmed that the Russian army has taken control of the southern port city of Kherson. At night, Kharkov and the capital came under heavy shelling.
Thales seeks to sharply increase its margins
Thales increased by 4.7%. The defense electronics group says it expects its operating margins to increase this year and organic growth of at least 2%, the company includes a €100 million negative impact on its earnings from the conflict in Ukraine in its forecasts. Thales also recorded a 32% increase in its operating profit in 2021 with record cash generation.
Societe Generale receives 0.8%. The bank says it can handle the impact of an “extreme scenario” on holding its banking assets in Russia, adding that such a scenario would not call into question the payment of its 2021 dividend. Russia is capped at 1.7%.
Other values discovered by Russia fell like Danone (-2.2%) and Renault (-2.9%).
Angie decreased by 3.3%. The energy company said it received 987 million euros for the Nord Stream 2 gas pipeline project, which is targeted by Western sanctions against Russia.