Advertorial — The flagship index of the Paris Stock Exchange increased by another 3.5% in February to post its fifth month of increase in a row… Many of the annual publications of big names in the stock market were welcomed, which made it possible to temporarily relegate to the background the uncertainties concerning the timetable for a first rate cut in the United States.
It came close, but the CAC 40 did not manage to overcome the symbolic threshold of 8,000 points in February. He nevertheless set several records, including the last at 7,977.68 points. Enough to show an increase of 3.5% over the entire period, a fifth month of increase in a row and an already appreciable gain of 5.1% since the start of the year.
This new performance is mainly due to the excellent season of annual results of the multinationals of the flagship index of the place, many of the big names in the rating saw their prices soar during this exercise of presentation of the 2023 accounts and prospects for 2024. In the wake of the 10.5% gain recorded in one session at the end of January by the world number in luxury LVMH, other big names in the CAC 40 have panicked the counters. This was particularly the case ofLiquid air (+8.2% on the day of publication), Bouygues (+8%), Capgemini (+6.8%) and the trio of automobile stocks Michelin, Renault And Stellantis (from 5.7% to 6.8%).
A cocktail of positive elements
The secret of this success is linked to three elements: turnover in line with or above analysts’ expectations despite a slowdown in major economies and the persistent lack of recovery in China, margins still increasing despite high material costs raw materials, procurement and recruitment in certain sectors. Investors have also enjoyed generations of cash flow supported, as are certain exceptional dividends or share buyback programs.
The real disappointments can be counted on the fingers of one hand or almost, but they have sometimes had serious consequences on the stock market, like the falls in Dassault Systèmes (-10.7%), BNP Paribas (-9.2%) and, on a lesser scale,Eurofins Scientific (-6.6%), L’Oreal And Agricultural credit (-5.2%). Any slowdown in growth, failure to meet margin or profit objectives free cash flow were severely sanctioned.
Nvidia confirms its star status!
However, American monetary policy remained at the center of all attention. On this point, the excitement of seeing the Fed lower its key rates for the first time in March has clearly subsided. Inflation is not decelerating enough for the central bank to take any immediate action. The data published in the middle of the month reveal that consumer prices certainly only increased by 3.1% year-on-year in January, less than the 3.4% in December, but the consensus was counting on a level of 2.9%. Worse, excluding volatile elements such as food and energy, inflation has not fallen, to 3.9% like the previous month. This is still almost twice as high as the 2% target set by the American Federal Reserve.
The American rating nevertheless held up well and provided another catalyst for the CAC 40 records. The craze for the phenomenon of artificial intelligence remained intact, in particular for the star Nvidiawhich once again defied all predictions with the publication of its fourth quarter accounts.
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