(BFM Bourse) – For this first session of February, the Paris Stock Exchange took no risk. The CAC 40 ended down slightly by 0.07% before the decision of the American Federal Reserve on its interest rates. Jerome Powell’s speech will be particularly followed by investors.
As usual, the Paris Stock Exchange is always feverish before the big meetings, the first of which is this Wednesday evening, with the decision of the American Federal Reserve on its key rates.
The CAC 40 ended down slightly by 0.07% at 7,077.11 points at the end of this first session of February. The star Parisian index ended January with a solid gain of 9.40%, erasing almost all of its decline over the year 2022 (-9.5%).
Investors are of course awaiting the US Federal Reserve’s decision on its rates. According to the CME Group’s FedWatch tool, the market is 98.7% expecting a rate hike limited to 25 basis points, or 0.25 percentage points.
But it is very clearly the indications of Jerome Powell, during his press conference which are dreaded by the markets. “As the Fed prepares to hike rates, could Powell spoil the market party?” asks Michael Hewson of CMC Markets, judging that there is a “disconnect” between market expectations and market expectations. indications given by members of the Fed in terms of rates.
“While Fed officials have insisted that rates will stay high for some time to come, markets simply don’t believe them,” he said.
Investors were able to take notice in the afternoon of a contraction in manufacturing activity in January, to 47.4 points against 48.4 points in December and a sharp drop in job creations in the sector. private. The ADP survey showed that the private sector created far fewer jobs than expected in January, 106,000. This could confirm that the monetary tightening at work is beginning to produce its effects.
“Inflation, like wage growth, remains too high compared to the inflation target and the continuation of their slowdown is not guaranteed given that the job market remains extremely tight”, explains his side. Xavier Chapard of La Banque Postale Asset Management. “Against this backdrop, we believe the Fed will maintain a tough rhetoric that the rate hike is not over yet and that rates will stay higher for longer than the market expects.”
Eramet nugget of the day
As for values, Eramet jumped 13.9% driven by Oddo BHF, which raised its board to “outperformance” against “neutral” previously.
Bonduelle appreciated by 4.4% after an increase in half-year sales, driven by price increases in Europe, but displayed its caution for the rest of its financial year.
Casino gained 1.9%. According to Bloomberg, the Saint-Etienne group could combine its activities with those of Teract, which includes Jardiland, Gamm vert and Boulangerie Louise among its brands.
Orpea had a volatile session to end down sharply by 22.2% as an agreement in principle was reached to restructure the finances at half mast of the operator of retirement homes. But this agreement will be synonymous with heavy dilution for shareholders.
On other markets, the euro gained 0.5% against the dollar at 1.0918 dollars. Oil contracts fall more than 2% after a surprise rise in crude oil inventories. Brent crude from the North Sea for delivery in April fell 2.4% to 83.39 dollars a barrel while that on WTI listed in New York for March lost 2.3% to 77.05 dollars a barrel.
Sabrina Sadgui – ©2023 BFM Bourse