As the Russian-Ukrainian conflict drags on, the financial markets experienced a Black Friday, weighed down by the economic uncertainties associated with it.
After resisting the Russian offensive in Ukraine rather well, the stock markets seemed to capitulate on Friday. The most important financial centers of the Old Continent, in particular German and Dutch, lost more than 4%, when the CAC 40 plunged by 4.97%.
The flagship index of the Paris Stock Exchange thus dropped some 10.23% over the past week, the worst since March 2020 and the crash linked to the start of the Covid crisis, and finds itself at its lowest for more than a year. year, at 6,061.66 points.
Soaring prices and fears of recession
While investors previously seemed rather confident in the solidity of European economies, soaring prices for oil, gas and agricultural materials have shaken certainties. Natural gas in Europe exceeded €200 per megawatt hour for the first time, while the barrel of Brent rose again, to $113.77. As for wheat and corn, they broke historic records with respectively €412 and €403 per tonne.
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The same is true for all metal prices, of which Russia is a major producer. Aluminum is posting a record price, at 3,867 dollars per ton, while nickel is also close to its highest. While general inflation was already a problem before the conflict, these peak prices and the shortages that could be created following the sanctions against Russia are aggravating fears of recession.
Russia exposure sends values to the mat
Unsurprisingly, and while only Thales managed to emerge in positive territory today in Paris, the CAC 40 stocks holding the most assets in Russia and/or Ukraine are undergoing real dips. This is the case for Société Générale (-10%), which today estimated its exposure to the area at 18.60 billion euros, and which in an extreme scenario, it did not rule out losing ownership of its bank assets.
Over the past week, Engie, which was a stakeholder in the stillborn Nord Stream 2 gas pipeline, lost 25.5%, and Renault, owner of Russian car manufacturer Avtovaz, plummeted 24.3%.