(BFM Bourse) – After three increases in the last four sessions, the CAC fell significantly on Friday under the effect of the accentuation of the correction of the Nasdaq, still against a backdrop of fears of anticipated monetary tightening. The flagship index is heading at this stage towards a slightly negative weekly performance.
While it has clearly decoupled from Wall Street (+0.6% for the CAC 40 and -5.9% for the S&P 500 since January 1) thanks to its lower allocation to technology stocks (victims of sector rotation at work), the tricolor barometer still suffered from the new sudden ebb of the New York indices on Thursday. Up 1.8% at the end of the morning, the Nasdaq ended the session down 1.3%, bringing its decline since January 1 to nearly 10%, “on the eve of an important deadline for options (having exacerbated the volatility of the day) and less than a week before the Fed’s monetary policy meeting “which is fueling a renewed risk aversion among operators, points out Mirabaud investment specialist John Plassard. This downward movement, which spread to Asian markets this morning, therefore did not spare the Paris market this Friday, the CAC 40 yielding 1.29% to 7,101.39 points at 11:15 a.m.
Investors are now nervously awaiting the meeting of the Fed’s monetary policy committee next Tuesday and Wednesday, hoping for clarification on the pace of monetary tightening to come.
“Market participants are currently torn. On the one hand, economic signals in Europe are green and the EU economy could get back on track in the next two to three quarters. has signs of exhaustion in US tech stocks, the drivers of the US stock market rally so far,” notes Andreas Lipkow, analyst at Comdirect. Last signal of this breathlessness: Netflix plunged more than 20% in pre-market trading on Friday after disappointing the market on the growth of its new subscribers in the last quarter. Now down almost 12% over the past two months, the Nasdaq is posting its steepest correction since the March 2020 crash, and futures are currently pointing to another open in the red (-0, 3%).
The automobile stalls, the tech weighed down by the Nasdaq
In Paris, where 38 of the 40 values of the flagship sample are displayed in the red at midday, only Safran (+0.7%) and Carrefour (+0.4%) floating timidly, the more pronounced declines are to be credited to automotive and technology stocks. Stellantis loose 3.1% after the sale, by Dongfend Motor, of nearly 1.3% of the capital at 18.30 euros per share, while Renault sells 2.1%. In the front line in the face of fears of stronger than expected monetary tightening, growth stocks, which include technology stocks (-3% for STMicro, -2.4% for Capgemini, -1.4% for Teleperformance), luxury (-1.7% for Kering, -1% for LVMH) and others like Eurofins (-2.8%), also relapsed heavily. It is nevertheless ArcelorMittal (-3.7%) and Alstom (-3.5%) which bring up the rear, the second remaining under pressure the day after the confirmation of its annual (and medium-term) objectives, despite the announcement of 7,500 recruitments in 2022 in the morning and the slight increase in the target of Invest Securities – all the changes in recommendations of the day can be found here. Airbus also lost 1.5% after canceling a contract with Qatar Airways for 50 A320 Neo.
The rest of the stock market is picking up somewhat under the effect of the increased pace of annual publications, which will accelerate significantly from February 1 with the results of LVMH. The homeopathy specialist Boiron, which has been making a strategic shift towards so-called “specialty” drugs since last year, confirms its recovery with further growth in its revenues in the last quarter, and resumes 10% at 11:45 a.m. Devastated by restrictions and multiple cancellations (major trade shows, sporting events, etc.) in 2020, event champion GL Events has strongly returned to revenue growth in 2021 (+54%) and confirms its objective of an annual net profit. The stock advances by 5.3%. Compagnie des Alpes grabbed 0.4% after reporting the “best quarter in its history”. Despite “a still heavy health context”, its revenues stood at 166.7 million euros between October and December, establishing a historic level for this period (+20.5% over one year and +36.6% per year). report on the 1st quarter of its (postponed) 2018-2019 financial year, the last full one before the pandemic).
Vallourec (-4.4%), TechnipFMC (-4%) and Schlumberger (-3.6%) suffered for their part from the decline in oil prices from their recent multi-year highs. Shortly before 12 p.m., the barrel of Brent indeed yielded 1.4% to 87.2 dollars while that of WTI fell 1.5% to 84.3 dollars. Operators are encouraged to take some profits by the latest figures from the EIA which revealed a surprise increase in crude inventories as well as gasoline reserves, which is a bad signal for demand.
In the foreign exchange department, the single currency is trading at 1.1340 dollars, up 0.24% from the previous day. The bitcoin finally fell to a low since last August (-4.4% to 38,900 dollars), also won by the lack of appetite for risk among investors before the Fed meeting.
Quentin Soubranne – ©2022 BFM Bourse