(CercleFinance.com) – The Paris Stock Exchange should continue its bullish streak on Monday at the start of a week which will be punctuated by the monetary policy meetings of several major central banks, including that of the Fed.
Around 8:15 a.m., the futures contract on the CAC 40 index – which has now switched to the April expiry – rose by 25.5 points to 8,211 points, suggesting a gain of around 0.3% at opening.
However, investors do not seem too eager to commit before the meeting of the American Federal Reserve, which begins tomorrow for two days of debates.
While they widely expect a new ‘status quo’ from the Fed, the markets will, as always, be on the lookout for the slightest revealing indication on the timing of future interest rate cuts.
Many analysts believe that the central bank could revise upwards its outlook for economic growth and inflation, meaning that there is still no urgency to reduce rates.
‘If the market comes to expect fewer rate cuts, or if increases start to be priced in (a very low risk in our opinion), the prices of risky assets would undergo a pronounced readjustment,’ warns Nanette Hechler- Fayd’herbe, strategist at Lombard Odier.
In addition to the Fed, the Bank of England (BoE) and the Swiss National Bank (SNB) will also meet this week, and again no change in rates is expected for these two central banks.
The surprise could come from the Bank of Japan (BoJ), which market rumors suggest intends to normalize its monetary policy by raising interest rates and putting an end to negative rates.
Like other European markets, the Parisian market has signed an unprecedented bullish series over the last three months, a dynamic which allowed it to climb another 1.7% last week and establish new historic highs.
A euphoria which makes Robeco analysts say that euro zone stocks ‘defy gravity’ despite an economic climate of ‘stagnation’ but ‘full employment’.
In this context, investors will be particularly attentive on Thursday to the publication of the preliminary PMI indices of the major economies of the Old Continent.
‘From a business cycle perspective, an emerging recovery in the global manufacturing cycle could particularly benefit Europe and generate value,’ acknowledges strategist Peter van der Welle.
Robeco notes, however, that European stock markets appear to have already priced in a full recovery in the manufacturing industry, which has not yet occurred and may very well not occur.
Copyright © 2024 CercleFinance.com. All rights reserved.
Did you like this article ? Share it with your friends using the buttons below.
