2024 - CAC 40: the titans of 'tech' will enter the scene

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(CercleFinance.com) – The Paris Stock Exchange should open higher on Monday morning while awaiting the first publications from American technology giants, which could well revive a gloomy trend on the markets for almost a month.

Around 8:15 a.m., the ‘futures’ contract on the CAC 40 index – delivery at the end of April – climbed 47.5 points to 7997.5 points, suggesting a green start to the day.

The earnings season will begin to kick into full swing in the United States this week, with results from tech titans Microsoft, Meta Platforms and Alphabet, which could offer a second wind to the markets.

The trend on global stock markets has become very gloomy since the historic records recorded at the end of March, due to the rise in bond yields, and solid performances would go a long way to reassuring investors.

The Nasdaq, the benchmark index for the high-tech sector in the United States, fell 5.5% over the past week alone, bringing its losses to 7% over the past two weeks.

‘We believe the recent risk aversion environment and correction that has affected technology stocks represents a clear buying opportunity ahead of upcoming results,’ says Dan Ives, analyst at Wedbush Securities.

The results season which opens this week should indeed benefit the American technology sector, which is currently benefiting from strong investment spending in AI, the ‘cloud’ and cyber security.

‘We believe that the 1st quarter accounts will constitute an important positive catalyst for the sector and anticipate an additional increase of 15% for tech stocks after their strong start to the year,’ adds Dan Ives.

The question is whether strong results will be enough to further advance the ‘Magnificent Seven’, which have already significantly outperformed the market in recent months and which boast high valuations.

Last week, Netflix published figures generally in line with expectations, which did not prevent the share price from dropping 9% after its surge in recent months.

Beyond the results, investors will continue to monitor the evolution of inflation with the publication, on Friday, of the PCE index in the United States, the Fed’s preferred indicator of price dynamics.

Before that, the publication – Thursday – of the first figures of American gross domestic product (GDP) for the first quarter will be closely followed.

The consensus forecasts a slight slowdown in growth, to 2.9%, after the 3.4% recorded in the fourth quarter.

The week will also be animated by preliminary figures from PMI surveys on the private sector in Europe, which could well show a slight improvement in business confidence at the start of spring.

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