(BFM Bourse) – The Parisian rating has put an end to its bullish streak, the lowering of IMF forecasts on global growth has annihilated any hope of a closing in positive territory. Caution was the watchword of the session on the eve of expected announcements from the US Federal Reserve on its rates, while traders took note of new corporate results.
The Paris Bourse is starting to fall again, the reasons for rejoicing were absent subscribers. The CAC 40 yielded 0.42% to 6,211.45 points, the day after a slight gain of 0.3%.
Investors continue to digest the many corporate publications. In Paris, the raising of the annual ambitions of Dassault Systèmes was welcomed while the slowdown in the quarterly activity of Soitec was sanctioned. The largest capitalization of the CAC 40, LVMH, for its part published record results in the first half … but after the closing. This has therefore not yet had an effect on the index.
On Wall Street, Walmart has once again warned about its results, the American distributor having taken the full brunt of the change in household consumption habits across the Atlantic due to rising prices.
Consumer confidence in the United States fell again in July for the third month in a row. This deterioration in household economic sentiment illustrates consumer fears about the continued rise in prices.
The Fed on Wednesday
Inflation will still be in question on Wednesday, when the US Federal Reserve will raise its key rates for the fourth time this week in an attempt to stem the surge in prices in the United States. It is once again engaging in a balancing act with the difficult task of controlling the trajectory of prices without precipitating the country into a recession. An increase of 75 basis points (0.75 percentage point) is now expected by investors, especially since the position of Christopher Waller, one of the governors of the Fed, and the president of the Fed of St. Louis James Bullard, two prominent members of the Fed who plead for an increase identical to that operated in June.
The US Federal Reserve’s decision on Wednesday will be followed by the release of US second-quarter GDP on Thursday, with the same indicator for the euro zone due out on Friday along with the first inflation estimates for July.
For the International Monetary Fund (IMF), the economic sky is darkening and the organization is consequently lowering its global growth forecast to 3.2% in 2022, against 3.6% last April. The probability that the United States will escape recession is low, said the chief economist of the IMF, the institution only counting on growth of 2.3% this year across the Atlantic.
In Europe, where fears about Russian gas supplies are increasingly felt after Gazprom’s decision to drastically cut off its gas deliveries to Europe on Wednesday, citing a technical problem linked to a turbine sent to Canada for maintenance. The European Union’s energy ministers have finally managed to reach an agreement to reduce their gas consumption and thus help Germany, which is heavily dependent on Russian blue gold.
The euro for its part yielded 0.7% to 1.015 dollars, weighed down by fears of economic recession on the Old Continent with the prospect of a reduced supply of gas.
Edenred has a ticket with the market, Soitec is struggling
On the stock side, Dassault Systèmes rose 0.8% after again raising its 2022 earnings per share target. It is targeting adjusted diluted earnings per share up 14% to 16%, or from 1.08 to 1.10 euro, against 1.04 euro to 1.06 euro previously.
Edenred closed up 3.5% after posting the best half of its history. The group issuing the famous Ticket Restaurant saw its results jump under the effect of inflation.
Walmart’s earnings warning has cast a chill over the entire European retail sector. Carrefour limited the breakage by losing only 0.7%. Casino Guichard (-5.35%), Fnac Darty (-4.9%) and Maisons du Monde (-6.5%) were not spared by the mistrust of investors towards a sector very sensitive to inflation .
Soitec increased its losses to 8.15%, the manufacturer of semiconductor materials showing a sharp slowdown in its growth in the first quarter of its staggered 2022-2023 financial year after two production incidents at its Bernin site, near Grenoble.
Eutelsat continues to plunge by 18.2% the day after a decline (already!) of 17.8%. Investors still take a dim view of the French group’s proposed merger with OneWeb in the spatial internet.
Sabrina Sadgui – ©2022 BFM Bourse