(CercleFinance.com) – The Paris Stock Exchange is expected to rise on Monday at the opening, the monetary easing decided by the Chinese central bank fueling the upward movement of recent weeks.
Around 8:15 a.m., the ‘futures’ contract on the CAC 40 index – August delivery – advanced 34 points to 6588 points, suggesting a start to the session in positive territory.
The People’s Bank of China surprised investors by announcing a lowering of its key rates, a move that attests to its fears about growth and the impact of the Covid epidemic.
The BPC’s strategy contrasts with the direction taken by the other major global central banks, which are now well advanced in their monetary tightening cycle.
These support measures prevailed over worse than expected economic statistics in the country, starting with a 2.7% increase in retail sales in July, which marks a marked slowdown compared to June.
In Europe as in the United States, the session should remain sluggish on Monday in the absence of leading indicators, with the exception of the Empire State index of the New York Fed which will appear at the beginning of the day. -midday.
By winning more than 1% last week, the Parisian market continued its summer ‘rally’ which enabled it to recover more than 9% in one month. Its decline since the start of the year is now limited to 8%.
The encouraging inflation figures released last week in the United States have largely reinforced this upward trend, but analysts warn that the fight against rising prices is not yet over.
‘The labor market is still very tight and employment growth has not yet slowed, which suggests that wage growth will continue to be sustained,’ said Danske Bank.
“It is currently close to 6%, which is far too high to consider bringing inflation down to 2% in a sustainable way,” warns the Danish bank.
While the program for the week promises to be relatively lighter, market participants will take note of several interesting statistics, such as the German ZEW index (Tuesday), British inflation (Wednesday) and consumer prices in the eurozone (Thursday).
In the United States are expected on Wednesday, retail sales and the ‘minutes’ of the last meeting of the Fed.
These are all headwinds that suggest the recent stock market rally may become less linear as inflation, growth and monetary policy data emerge.
“From our perspective, markets are set to experience some volatility, largely due to looming Fed rate hikes in the coming months,” warns US asset manager Edward Jones .
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