(CercleFinance.com) – The resilience of the Paris stock market continues to amaze: the CAC40 managed to climb -1% towards equilibrium this midday, despite -2% on the S&P500 and -2.5% on the Nasdaq (these 2 indices resumed modestly +0.2% to +0.4% this Wednesday).
The Euro-Stoxx50 lost only 0.3% and the DAX -0.2% (like the CAC40): the business climate improved in Germany in February.
The index published by the Ifo institute (based on a survey of 9,000 companies), rose by +1pt to 91.1 points this month.
While the current conditions component is down to 93.9 from 94.1 the previous month, the expectations component is up sharply from 86.4 to 88.5 in February.
This slight improvement in the index – calculated on the basis of the responses of business leaders in the main market sectors – is mainly due to that of the general and personal outlook for activity in services.
Earlier, investors learned that the German inflation rate, measured by the year-on-year change in the consumer price index (CPI), stood at +8.7% in January 2023, according to Destatis thus confirming its preliminary estimate of February 9.
The main ‘market mover’, which are rates, does not affect the Parisian index, which is resisting the spectacular rise in bond yields.
On the Treasuries market, the ten-year yield exceeded the 3.95% threshold yesterday evening, establishing a new high level since last November: a slight relaxation takes place with -3.5 Pts to 3.918% .
While at the end of January the final Fed rate forecast was estimated at 4.9% in June, markets are now pricing in a final rate of more than 5.3% from the Fed in July. … and 25% of operators are now aiming for 5.60% instead (ie 4 additional rate hikes by the summer).
These forecasts lead to a general resumption of tensions on rates, both short and long, with French 10-year OATs jumping towards 3% (-1Pt to 3.01%) and German Bunds tending to 2.525% (vs. 2.535 % the day before).
This evening, the publication of the ‘minutes’ of the last meeting of the Fed will be of less interest than usual because all the figures published since this meeting have emerged above expectations.
The Dollar continues to rise and climbs up to around 1.0630/E.
In corporate news, Korian published last night a turnover of 4,534 ME for the 2022 financial year, representing organic growth of 6.2% compared to the previous financial year. EBITDA amounted to 607 ME, up 1.6%, while net income group share amounted to 52 million euros, down 54% compared to the same period twelve months earlier.
Danone publishes this morning for 2022 a current EPS up 3.6% to 3.43 euros, despite a current operating margin down 1.5 points to 12.2%, with ‘reinvestment in brands, the superiority of products, organizations and skills’.
Saint-Gobain announces that it has entered into an agreement to acquire UP Twiga Fiberglass Ltd, the leader in the glass wool insulation market in India, with two production plants near Delhi and Mumbai.
Stellantis rose on the stock market on Wednesday following the presentation of ‘record’ results for the 2022 financial year and the announcement of a share buyback program of 1.5 billion euros.
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