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(BFM Bourse) – The Paris Stock Exchange closed down on Wednesday evening, undermined by renewed tensions on bonds, particularly on French debt. The CAC 40 closed down 0.50% at 7,565.62 points on Wednesday evening.
The rebound was short-lived for the Paris Stock Exchange, which fell again on Wednesday. The CAC 40 ended down 0.50% at 7,565.62 points after rising 1.28% on Tuesday with the announcement of the Chinese recovery plan.
Traders are now trying to assess the positive impact of these measures aimed at reviving a faltering Chinese economy. Markets have also opted for caution ahead of the publication of key economic data in the United States in the next two days.
New tensions on the debt market
“Traders are now focused on three risk events: the US GDP release tomorrow, Jerome Powell’s upcoming speech and the PCE data (the US Federal Reserve’s preferred measure of inflation, editor’s note) due on Friday. These events are likely to have a significant impact on the markets,” notes Ricardo Evangelista of Activtrades.
In Europe, renewed tension was observed on bond rates. Yields on 10-year bonds increased by 3 basis points (0.03 percentage points) for Germany and by 5 basis points for Spain and Italy.
For France, the yield on the 10-year Treasury bond rose by 6 basis points, the most significant increase among the major European countries.
The gap with Germany on the 10-year rate, a gauge of market confidence in the signing, reached 80 basis points during the session.
This resurgence of tensions came after Laurent Saint-Martin, the Minister responsible for the Budget and Public Accounts, declared that he feared a public deficit of more than 6% in 2024.
“The situation of our public finances is serious. (…) In 2024, the public deficit risks exceeding 6% of the gross domestic product,” he told the Finance Committee of the National Assembly.
Air France-KLM takes off with JP Morgan
On the value side, Air France-KLM finished at the top of the SBF 120 (+6%) carried by JPMorgan, which raised its advice on the stock by two notches to “overweight” from “underweight”. The bank believes that the company’s results will improve in 2025, which is not reflected in the share price, which is at historic lows.
Ubisoft, for its part, fell by 4.5%, with the market fearing all day that the release of its game “Assassin’s Creed Shadows” would be delayed, following certain press reports. Information finally confirmed by the group in a press release published after the close in Paris, acknowledging a three-month postponement for the last game in its flagship license.
Orange, for its part, returned 1.25% while the telecoms group announced that it would soon leave the New York Stock Exchange.
On the small and mid-cap side, Réalités dropped more than 34% while the developer, weakened by the real estate crisis, initiated conciliation proceedings with its creditors.
On other markets, the euro lost 0.3% against the dollar to 1.1156 dollars. Oil accelerated downwards. The November contract on North Sea Brent lost 1.4% to 73.42 dollars per barrel while the same contract on WTI listed in New York recovered 1.8% to 70.23 dollars per barrel.
Sabrina Sadgui – ©2024 BFM Bourse
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