(BFM Bourse) – The Paris index fell 0.94% on Friday, caught up in concerns about inflation and the Federal Reserve’s monetary policy. Investors’ attention will turn next week to the central bankers’ conference in Jackson Hole.
The CAC 40 failed to follow suit. After a sluggish session, the Parisian index fell 0.94% on Friday to 6,495.83 points. Over the week as a whole, the CAC 40 lost 0.89%, breaking a series of six consecutive weeks of increases.
Market operators are still questioning the intentions of the Federal Reserve (Fed). St. Louis Fed President James Bullard told the Wall Street Journal on Thursday that he was in favor of raising rates by 75 basis points in September. Mary Daly, her counterpart at the San Francisco Fed, said the same day that an increase of 50 or 75 basis points would be “reasonable”. According to the CME Group’s FedWatch tool, investors are torn between these two increases, assessing the probability of a monetary tightening of 50 basis points at 54.5% against 45.5% for an increase of 75 basis points.
Jackson Hole in sight
Next Friday, investors will be watching with great interest as Fed Chairman Jerome Powell speaks at the annual conference of central bankers in Jackson Hole. For Bruno Cavalier, chief economist of Oddo BHF, the central banker “will undoubtedly endeavor not to appear ‘dovish’ [accommodant, NDLR]”because “the Fed’s anti-inflation credibility is at stake”. must,” he said.
Investors also continue to worry about inflation. Producer prices in Germany, published this Friday morning, sent a new negative signal on this subject. They increased by 37.2% over one year in July, according to the Federal Office of Statistics, the strongest increase since 1949. Over one month, the increase is 5.3%. Mark Dowding of Royal Bank of Canada BlueBay Asset Management believes eurozone inflation may not peak until early 2023. rise to at least 10% over the coming months and would not peak until the first quarter of next year, he anticipates.
Dollar strength
On the stock side, several cyclical stocks ended lower. Automakers Renault and Stellantis lost about 3% each, banks Societe Generale, BNP Paribas fell nearly 3%. Property companies also underwent withdrawals: Covivio lost 3.7%, Mercialys gave up 3.3%, Icade lost 3.6%. The collective catering group Sodexo for its part dropped 1.3%, penalized by a lowering of Jefferies’ recommendation to buy and keep. Air France-KLM suffered the largest drop in the SBF, with a decline of 5.05%.
On the foreign exchange market, the dollar is still reaping solid gains against other currencies, benefiting from its status as a safe haven. The euro thus lost 0.5% against the dollar at 1.0043 dollars. The British pound lost more than 1% to 0.8468 dollars.
Oil contracts are gaining ground. North Sea Brent for October delivery takes $1.16 to $97.75. The September contract for Nymex-listed light sweet crude (WTI) gains $1.4 to $91.94.
by Julien Marion
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