(CercleFinance.com) – The euphoria is falling a little on the Paris Stock Exchange (+0.5% to 6,505) which had soared by +1.2% in the morning (for reasons that remain to be established), the CAC40 s soaring towards 6.555 Pts.
At that time, the CAC posted more than 750Pts taken back since June 16 (+13%) and +11% taken back since July 14.
Buyers have been more cautious since a mixed opening on Wall Street (-the 3 indices fell 0.2 to 0.3%) while the S&P500 (+0.1%) has just recovered +15% and the Nasdaq +19% in 6 weeks.
It should also be noted that the +70Pts of the CAC40 this afternoon were acquired with less than 850MnsE exchanged (in 4 hours and 1.5MdsE in 8 hours): in other words, faced with a ‘funicular algorithm’, all the selling counterparty is literally paraded and the market progressed in a sidereal vacuum, which is unhealthy.
The CAC is supported by the banking stocks which sign the strongest increases, with Crédit Agricole (+4.5%), BNP and Société Générale (+2%).
The easing of rates is also a good surprise since our OATs erase -8.5Pts to 1.436% and the Bunds -6Pts to 0.808%… and the best is the Italian BTPs which relax by -10Pts to 2.93 %, here they are at less than 215Pts of ‘premium’ compared to the Bund.
The Euro-Stoxx50 posted +0.5%, helped by the DAX which gained +0.7%.
Note that the London Stock Exchange is still largely lagging behind (+0.3% the day before, +0.1% this Thursday) while the Bank of England announced – as expected – a 50 basis point increase in its main key rate at 1.75%, in line with expectations and almost unanimously by the 8 members of the Monetary Policy Committee.
What was not expected, however, is that the BoE is revising its inflation target sharply upwards, to 13.1% against 9.4% in June.
Inflation would remain at very high levels for much of 2023, before falling back to the 2% target by 2025.
Finally, the United Kingdom will enter recession in the 4th quarter of 2022 and will not come out of it until the end of 2023!
What shower the enthusiasm of the markets.
But good news across the Atlantic since the trade deficit of the United States fell to 79.6 billion dollars in June, compared to that of 84.9 billion the previous month (which was revised from an initial estimate 85.5 billion), according to the Department of Commerce.
The 6.2% month-on-month decline reflected both 1.7% growth in U.S. goods and services exports to $260.8 billion and a slight decline of 0.3 % of imports, at 340.4 billion.
Weekly jobless claims rose again the week of July 25 in the United States, standing at 260,000, against 254,000 (revised figure) the previous week, according to figures from the Labor Department.
The four-week moving average – which can be considered a better indicator of the underlying trend in the labor market – also came out higher, at 254,750 against 248,750 (revised figure) a week earlier.
Oil fell sharply in New York, and at $89.40, a barrel returned to pre-Ukrainian invasion levels (the ‘Brent’ also lost -2% to $94).
The start of the day was marked by the publication of a new round of results from multiple European heavyweights, including Crédit Agricole, adidas, Bayer, ING, Lufthansa and Merck KGaA.
In the tense economic context of the moment, investors remain particularly attentive to signs of an aggravation of the slowdown in growth and the impact of inflation on corporate margins.
The markets seem for the moment to be looking for any pretext to climb since the renewed geopolitical tensions in Taiwan have never been taken seriously since Monday.
Many strategists warn that the markets could be very volatile during this summer break, given traditionally lower volumes and a still very uncertain environment both economically and politically.
Gilles Guibout, head of European equities at AXA IM, recalls that new governments still need to be formed in Italy and the United Kingdom.
The manager also warns against the persistence of the war in Ukraine, which continues to pose a risk to gas supplies on the Old Continent and therefore to the evolution of the energy bill.
In the news of French securities, Crédit Agricole publishes for the second quarter of 2022 an underlying net profit group share up 18.1% to 1.91 billion euros, as well as a gross profit of underlying operating up 7.4% to 2.79 billion.
SES unveils for the first half of 2022 an improvement in adjusted net profit of 10.6% to 168 million euros, despite an adjusted EBITDA margin down 1.6 points to 60.6% for growing revenues 2.8% to 899 million (-2.1% excluding currency effects).
Finally, Novacyt announced on Thursday that it had expanded its portfolio with the launch of new freeze-dried PCR tests allowing kits to be transported at room temperature.
Copyright © 2022 CercleFinance.com. All rights reserved.
Did you like this article ? Share it with your friends with the buttons below.
