(CercleFinance.com) – The Paris stock market (-1.54%) amplified its losses at 2:30 p.m., falling from 7,110 to 7,005 points at the close – after having offered a quick excursion below 7,000 pts.
The drop in stock market indices is general in Europe: the Euro Stoxx50 lost 1.8%, while Frankfurt and London lost 1.4% and 0.5% respectively.
Across the Atlantic, the fear of seeing Wall Street consolidate (the ‘futures’ had stalled shortly after the productivity figures) has been confirmed: the Dow Jones yields 0.6%, below 35,400, S&P500 drops 1.3% towards 4,530 and the Nasdaq lost 2.1%, penalized by Meta Platforms with -24% towards $243.
Very scrutinized, the announcements of the ECB and the BoE, finally amounted to a non-event.
The Bank of England (BoE) raised – as expected – its main interest rate by 25 basis points to 0.5% (as expected), but 4 of the 9 members of its Monetary Policy Committee voted in favor of it. an increase of +50pts, to 0.75%.
The BoE expects inflation to exceed 7% in the spring.
As for the ECB, it is leaving – as expected – its key rate at ‘zero’ and indicating that it will maintain the size of its balance sheet (which will peak in March around 9,000 billion euros) by completing its portfolio as lines arrive at maturity, at least until the end of 2024).
If the PEPP does indeed come to an end at the end of March, the ECB will continue its net purchases under its APP program to the tune of 40 billion euros until the end of the 2nd quarter of 2022, then to 30 billion euros throughout the 3rd, before resuming a monthly rate of 20MdsE in the 4th for an indefinite period
In terms of US figures, the most recent concerned growth in the tertiary sector: the ISM (Institute for Supply Management) index fell by -2.4 Pts to 59.9 last month (after 62.3 in December) when economists predicted a score of 60.
The sub-index measuring activity fell sharply, to 59.9 from 68.3 in December, while that of new orders fell by only 0.4 points, to 61.7 from 62.1 a month earlier.
The price paid sub-index eased to 82.3 from 83.9; Finally, we note a pronounced drop in the employment component, which lost 2.4 points to 52.3.
On the unemployment side, the number of weekly claims for benefits fell by -23,000 the week of January 24 in the United States, standing at 238,000, against 261,000 (revised figure) a week earlier.
On the other hand, the four-week moving average is up slightly, at 255,000, up 7,750 from the revised figure for the previous week.
Finally, during the week of January 17, the number of people regularly receiving benefits stood at 1,628,000, a decrease of 44,000 compared to the revised figure for the previous week.
Non-farm productivity rebounded 6.6% in the United States in the fourth quarter of 2021 on an annual basis, according to the preliminary estimate of the Labor Department, after a fall of 5% in the previous quarter (revised from a previous estimate -5.2%).
This rebound, greater than the consensus, reflects a 9.2% growth in production for a 2.4% increase in the number of hours worked. Furthermore, unit labor costs increased by only 0.3% due to a 6.9% jump in hourly wages.
In France, we note the marked slowdown in the expansion of the private sector in France. Indeed, the composite index of global activity recorded its strongest decline compared to December, from 55.8 to 52.7, which brings it back to its lowest level for nine months.
This trend reflects a slowdown in growth in the services sector, where the upsurge in the number of Covid-19 cases linked to the spread of the Omicron variant weighed on the sector’s performance.
“The sharp rise in Covid-19 cases has indeed been synonymous with staff shortages in some companies, a trend that has slowed business growth,” said Joe Hayes, senior economist at IHS Markit.
This day will be marked by a sudden surge in the yield of OATs which jumped +13Pts basis towards 0.575%, the Bunds posting +11.5Pts towards +0.15%.
US long rates rebounded by +7pts towards 1.8250%: they fared better than our OATs, despite the slippage in US wage costs at almost +7%.
Investors will also have to digest an impressive wave of quarterly corporate results, with publications sweeping across both Europe and the United States.
As such, Meta Platforms sees the disintegration of more than $200 billion in capitalization after the publication of results that are well below expectations and prospects that leave one skeptical (heavy investment resulting in a loss of $10.2 billion for the development of the ‘Metaverse’, the consensus was counting on -$10 billion).
At current price levels, the technology group would thus see nearly 180 to 200 billion dollars of capitalization go up in smoke today, the equivalent of a full year of earnings.
On Forex, the Dollar recovered slightly by +0.15% towards 1.1280/E.
In the news for French companies, the speculative blow on Atos (-7.4% to 32.4E) is falling: rumors of talks with Thalès are denied on both sides.
Dassault Systèmes publishes for 2021, in non-IFRS data, an EPS up 26% to 0.95 euros and an operating margin up four points to 34.3% for a turnover up 9 % to 4.86 billion euros (+11% excluding currency effects).
Publicis Groupe publishes current EPS up 17.6% to 5.02 euros for the past year, as well as free cash flow (FCF) up 19.9% to 1.4 billion euros. euros. At nearly 10.5 billion euros, the communication group’s net revenues increased by 8%, including organic growth of 10% for the year, with a fourth quarter above expectations at +9.3% .
Finally, Synergie posted record activity with annual revenue of nearly 2.7 billion euros in 2021, significantly exceeding the all-time highs reached in 2019, with an increase of 23.1% compared to 2020 ( +22.8% at constant scope and currencies).
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