(BFM Bourse) – The CAC 40 advanced by 1.28% at mid-session. The euro is recovering against the dollar, driven by expectations of monetary policy tightening by the European Central Bank.
The wind of optimism that carried the market on Friday continues to blow on Monday. The Paris Stock Exchange is thus moving up sharply and ahead by 1.28% to 6,291.97 points at mid-session, chaining a sixth consecutive increase.
“European equities start in the green on Monday, after a relatively calm day in Asia, due to the closing of markets due to a public holiday in China, Hong Kong and South Korea”, explains Craig Erlam of Oanda. .
Yet “if we look at the energy crisis more closely, nothing has yet improved significantly […] as the threats of major chaos still loom over the Eurozone and the UK as winter approaches,” notes AvaTrade’s Naeem Aslam.
US inflation in the sights
“Nevertheless, market participants are hoping for the best and bracing for the latest US inflation data to be released on Tuesday,” he said. These statistics will be published one week before the Federal Reserve (Fed) monetary policy meeting, the vast majority of whose operators are awaiting the announcement of a 75 basis point (0.75 percentage point) increase in key rates. .
On the side of the European Central Bank (ECB), the President of the Bundesbank, Joachim Nagel, who is also a member of the Governing Council of the ECB, indicated on Sunday that he expected further “significant” rate hikes in the event where inflation in the euro zone would not fall.
These comments, as well as a renewed appetite for risk, support the euro which is up 0.9% against the dollar at 1.0136 dollars. Oil prices are gaining ground. The North Sea Brent contract for November delivery is up 1% at 93.87 dollars while the WTI for October delivery is up 1% at 87.68 dollars.
Orpea’s stock market torture continues
On the stock side, the rally is benefiting cyclical stocks, including transport groups and oil-related stocks. Vallourec takes 9%, CGG 6.3%, Renault advances by 3.7%, Alstom by more than 4%.
But the biggest change in the SBF 120 remains Orpea, which plunged 20% after announcing that its second-half margins will fall again after having already suffered a sharp drop in the first six months of 2022. In its wake, Korian sold 2 .5% around 12:50 p.m. On the small-cap side, cookware company Mastrad fell 12.7% after reporting its full-year 2021-2022 earnings.
Julien Marion – ©2022 BFM Bourse