(BFM Bourse) – The Paris Stock Exchange has completely erased yesterday’s rebound, inflation risks are putting pressure on the trend again. The burst of pride lasted only during the close, with the CAC 40 moving towards 6100 points on a drop of more than 2%.
The bounce will make the pshiit… Confusion reigns in the minds of operators who are no longer able to interpret the recent inflation data in the United States for April. If the news was well received in Europe and a bountiful recovery was recorded at Wednesday’s close, the CAC 40 also closed up 2.5% (the biggest gain since a 3% jump on March 29 with the resumption of talks between Russia and Ukraine, hopefully largely disappointed) – in the US, investors see the glass completely empty, which gives Wall Street a slight hangover at the close of Wednesday evening.
The Dow Jones fell 1.02% and the S&P 500 shed 1.65%, while the Nasdaq plunged another 3.18% after a nightmare session for tech stocks on fears of tightening monetary policy with side of the Fed. Since its peak in late November, the stellar techno index has lost almost 30%. In this context, the Paris Stock Exchange finds it hard to find the strength to start over, CAC 40 erases all of its gains from the previous day and returns 2.46% to 6115.44 around 12:30.
It must be said that the Consumer Price Index (CPI) was indeed a macroeconomic meeting not to be missed this week. That figure was +8.5% year-on-year in March, falling to +8.3% in April, according to the Bureau of Labor Statistics. According to the general opinion of economists, the bet is on a slightly more noticeable slowdown (+8.1%). If the first reading of statistics was based on slowing inflation, then the second vision of this indicator makes operators sweat. Core inflation (except for energy and food) has accelerated since January, providing food for thought for more aggressive rate hikers.
STMicro holding the helm, dark Bénéteau
In terms of value, with a higher 1% gain, STMicroelectronics is countering a sharp fall in the Paris index driven by its targets unveiled during the traditional Investor’s Day. The semiconductor group says it aims to reach over $20 billion in turnover in 2025-2027 with a gross margin of around 50%.
Bouygues declined slightly (-1.3%). The conglomerate reported higher-than-expected quarterly activity, but its results fell negative due to the sale of Alstom shares (+1.05%).
Veolia Environnement returns over 4%, the group confirms its 2022 guidance after quarterly results driven by Suez integration.
Ahead of the averages, Chargeurs’ share price jumped more than 8% in a market that was nevertheless subdued. Investors welcome more dynamic first quarter activity than ever, while the firm will set aside 8 million euros for share buybacks.
Bénéteau is gloomy on the stock market, commercial momentum and good order book orientation do not match worries about tight supplies.
In foreign exchange terms, the euro is at a 5-year low against the dollar, reinforced by fears of more aggressive monetary tightening in the United States, at $1.0435. Oil prices are regaining their breath and are up more than 1.5% after a sharp rise the day before, Brent thus moving up to $105.84 with WTI trading at $104. According to the International Energy Agency, the global oil market will not be subject to shortages even if sanctions against Russia are tightened.
© 2022 BFM Exchange