(CercleFinance.com) – The Paris Stock Exchange should rebound on Tuesday at the opening after its heavy losses the day before, reassured by the jump made by Wall Street after the close of European markets.
At 8:15 a.m., the ‘future’ contract on the CAC 40 index – February expiry – currently shows a gain of 77.5 points to 6862 points, announcing an attempt to recover at the start of the day.
The Parisian market ended yesterday’s session with substantial losses of almost 4% at 6787 points, in massive volumes of 5.6 billion euros.
A downward momentum took hold of the CAC from the opening, before gaining momentum over the hours, carrying in its path all the technical supports one after the other.
The sinking of 7000 points confirmed in particular the scenario of a deterioration in the trend, with a CAC 40 on the verge of entering a ‘bear market’ configuration with a decline which now reaches more than 8% from its recent highs.
But a jump took shape in New York after the Paris market closed, confirming the existence of a context conducive to volatility due to the tightening of monetary policy initiated by the Fed.
In the red for most of the session, the US markets managed to climb into the green shortly before the close, allowing the Dow Jones to gain 0.3% and the Nasdaq to recover 0.6%.
Some investors finally emerged to ‘buy the dips’ in equities, in a near-widespread buying spree as eight of the 11 S&P 500 sectors ended in positive territory
Only traditionally more defensive sectors such as health or community services lagged behind.
With no leading indicators today, investors’ attention should focus on the Fed’s two-day Monetary Policy Committee (FOMC) meeting.
The fear of an acceleration of inflation and monetary tightening is at the heart of the correction observed on the markets since the beginning of the year, first on the bond compartment then on equities.
The press release that the central bank will publish tomorrow could provide investors with valuable indications as to the timetable envisaged for its monetary tightening and provide them with welcome visibility.
On the bond market, government bond yields confirm their lull, that of 10-year Treasuries stabilizing around 1.75%.
It is true that the ‘Treasuries’ constitute a traditional refuge in the context of geopolitical tensions, such as those which are soaring at the moment over Ukraine.
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