(CercleFinance.com) – After losing more than 3% last week, the Paris Stock Exchange seems ready to continue its decline on Monday morning, at the start of a week that promises to be loaded with economic indicators.
Around 8:15 a.m., the ‘future’ contract on the CAC 40 index – September delivery – fell 86.5 points to 6186 points, signaling a decline of more than 1% at the opening.
The summer break now over, the stock markets are preparing for a potentially decisive comeback, which will culminate on Friday with the job creation statistics in the United States, still closely followed by investors.
Jerome Powell, the head of the Fed, reaffirmed last Friday at the Jackson Hole symposium that the central bank intended to use ‘vigorously’ all its tools to fight inflation.
The chairman of the Federal Reserve has acknowledged that this fight against inflation could slow down growth in a lasting way and hurt American households.
Unsurprisingly, the prospect of a possible acceleration of the institution’s monetary tightening has once again weighed on Wall Street since mid-August.
By giving up almost 4% over the whole of the past week, the S&P 500 signed a second consecutive week of decline.
Investors now fear that monetary firming will intensify despite weakening economic indicators.
Before Friday’s main course, the market will have other indicators to eat, including the latest inflation figures in the euro zone, expected on Wednesday.
Better-than-expected numbers would surely bolster the prospect of a major rate hike, perhaps 75 basis points, from the ECB next week.
Investors also remain attentive to the situation on the energy market, which particularly penalizes the euro, now stuck below the parity threshold against the dollar.
Under such conditions, it seems unlikely that the equity markets will manage to return to calm.
The CBOE volatility index, the most followed barometer of the state of mind of investors in the United States, rose again on Friday above the 25-point mark.
VIX futures indicate that the ‘fear index’ may rise further in the coming months.
The history of Wall Street in this respect encourages caution for the coming weeks: with an average loss of 0.5% according to the Stock Trader’s Almanac, September is traditionally the worst month of the year for American stocks.
Copyright © 2022 CercleFinance.com. All rights reserved.
Did you like this article ? Share it with your friends with the buttons below.
