The Paris Stock Exchange ended its best session in more than three months on Friday, up 3.23%, applauding an indicator suggesting a slowdown in inflation in the United States.
The star CAC 40 index took 190.02 points to 6,073.35 points, its best progression since March 16. Over the week, it rose by 3.24%, the first weekly increase in June.
But since January 1, the index has fallen by another 15.09%.
Already up sharply since the start of the session, the Parisian coast accelerated after the publication of medium-long-term inflation expectations from the University of Michigan, which came out below expectations, explains AFP Alexandre Neuvy, director of private management at Amplegest.
Investors have had their eyes riveted on inflation for several months, as have central banks which are drastically tightening their monetary policy in order to stem the rise in prices.
But this movement is also at the expense of economic activity and raises fears of a possible recession.
A decline in inflation expectations, if confirmed with other indicators, would ease the pressure on central banks, and therefore on their restrictive turn.
The session concluded a week where falling interest rates on the bond market calmed investors down a bit, with an impressive drop in rates on Wednesday and Thursday, Mr. Neuvy noted.
The French rate for the 10-year loan ended the week below 2% (1.96%), while it was still over 2.32% on Tuesday at the close.
Interest rates fell on fears of recession in the United States and the euro zone, in particular with PMI economic activity indicators published on Thursday which showed a sharp slowdown in June.
It is complicated to think that we can sustainably have a recession with inflationary pressures, supports Mr. Neuvy.
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Tech and luxury benefit from lower rates
Technology stocks took advantage of the easing of bond yields to make up some of the losses recorded since the start of the year. Teleperformance took 4.07% 294.20 euros, Dassault Systmes 4.36% 36.64 euros and Capgemini 2.18% 178.35 euros.
Other so-called growth stocks, which need low rates to finance their growth and enhance their long-term profits, such as healthcare (Sanofi +5.02% to 100.56 euros), or even luxury (LVMH +3.78% to 587.40 euros, Kering +2.55% to 502.50 euros) also benefited.
Profit taking on Valneva
After four sessions of strong growth, boosted by the acquisition of the American laboratory Pfizer and then by the approval of its vaccine against Covid-19 in the European Union, the Franco-Austrian biotech Valneva fell by 11.13% 12 ,64 euros. Over the week, however, it increased by 59.36%.