(BFM Bourse) – End of series. The Paris Stock Exchange puts an end to its bullish sequence, the reasons for uncertainties on the political situation in Italy and the supply of Russian gas to Europe have finished to complete the bullish inclinations of the Parisian star index. The CAC 40 lost 0.27%, back below 6,200 points on Wednesday evening.
After having recorded a peak in session at 6,245.47 points, the CAC 40 ends this new stock market day down 0.27%, back below 6,200 points at 6,184.66 points. On Wall Street, the trend is more uncertain the day after a sharp rise: the Dow Jones grabbed 0.05%, the S&P 500 won 0.8% while the Nasdaq progressed more frankly (+ 1.2%). at the close of European markets.
The appeasement that prevailed at the beginning of the week after reassuring remarks from two Fed officials on the Federal Reserve’s rate hike expectations has now fizzled out. Operators now fear the repercussions of a reduction or worse of a total stoppage of Russian gas supplies on the growth of countries dependent on the Nord Stream 1 gas pipeline, the reopening of which is expected on Thursday. A halt in Russian gas deliveries to Europe would indeed cut the value of German GDP by almost 5% between 2022 and 2024, according to forecasts from the International Monetary Fund (IMF) published on Wednesday.
In addition, Russia – through its head of diplomacy Sergei Lavrov – affirmed that its military objectives in Ukraine would no longer be confined solely to the east of the country, but could extend to “other territories”. .
The Italian political situation also remains in the sights of the markets. The President of the Council, Mario Draghi, will submit to a vote of confidence in the Senate on Thursday after his intervention intended to avoid a serious political crisis in the country. The future of Mario Draghi as President of the Council will be the backdrop to the meeting of the governors of the European Central Bank on Thursday. The ECB has indicated that it wants to raise its key rates by 0.25% for the first time since 2011. But the current trajectory of consumer prices in the zone could lead the ECB to toughen its tone and proceed with a larger hike of its key rates, by 0.5%, reports Reuters, citing sources familiar with the matter.
In addition to inflation, the Central Bank must contain the growing divergence in the remuneration demanded by investors between the debt of the strongest countries and those considered financially more fragile (the spread, i.e. the difference between the yield ten-year German Bund and its Italian equivalent). The anti-fragmentation tool that will be unveiled by the ECB could meet an imminent need if the political situation were to worsen in Italy with a possible departure of the Chief Executive. Expectations of a rise in the key rates of the ECB maintain the euro on the 1.0202 dollar.
On the business front, Carrefour limited its gains to 0.7%, the retailer signed an agreement to sell its 60% stake in Carrefour Taiwan to Uni-President, its “longtime partner and co-shareholder”.
Publicis won for its part 1.8%, supported by the quarterly performance of its American competitor Omnicom.
The French pharmaceutical laboratory Virbac exclusively dedicated to animal health has just unveiled dynamic growth in the first half, leading it to confirm its financial forecasts for 2022. Virbac warns, however, that the rise in prices will weigh on its costs. The title lost 9.7% to record the largest drop in the SBF 120 on Wednesday at the close.
Sabrina Sadgui – ©2022 BFM Bourse