Cac 40: The market questions the health situation in China, the Paris Stock Exchange stagnates

(BFM Bourse) – The CAC 40 was almost stable at mid-session, as investors worried about the inflationary pressures that the reopening of the Chinese economy could create and the current wave of contamination in the country.

The Paris Bourse is struggling to consolidate the gains recorded on Tuesday. At mid-session, the CAC 40 lost 0.01% to 6,549.86 points on Wednesday.

After welcoming Beijing’s announcement of the lifting of quarantines for people entering Chinese territory from January 8, investors are more mixed.

“This is bad news for inflation,” said Ipek Ozkardeskaya, of Swissquote Bank, quoted by AFP, because the Chinese economic recovery should lead to an increase in demand and therefore “in energy and raw materials prices first”.

The surge in Covid-19 contaminations in China is another reason for concern for the market. “Many reports suggest that Covid cases are on the rise in China, which really threatens the global supply chain”, underlines Naeem Aslam, analyst at AvaTrade.

Rising bond yields

At the same time, bond yields continue to rise and the 10-year French bond rate is now above 3%.

This rise in rates penalizes the actions of indebted groups. Casino drops 1.8% and Air France-KLM loses 1.3%.

On the side of smaller caps, AB Science wins more than 4.5% after mastinib, its molecule for treating amyotrophic lateral sclerosis, obtained orphan drug designation from the Swiss Institute for Therapeutic Products.

On the other markets, the euro is almost stable against the dollar, at 1.0638 dollars. Oil prices fell slightly. The contract on Brent from the North Sea for delivery in February dropped 0.2% to 84.50 dollars a barrel while that of the same expiry on WTI in New York yielded 0.4% to 79.19 dollars a barrel.

Julien Marion – ©2022 BFM Bourse

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