(CercleFinance.com) – The Paris Stock Exchange should recover on Friday morning while awaiting the start of the results season in the United States, which begins while the stock markets are experiencing a bout of volatility.
Around 8:15 a.m., the ‘future’ contract – delivery at the end of April – on the CAC 40 index is trading at 8072 points, up 45 points, announcing a rather favorable start to the session.
Recently concerned by the awakening of American inflation, investors will have the opportunity to return to fundamentals today with the opening of the first quarter results season.
As usual, the major American banking groups JPMorgan Chase, Citi and Wells Fargo will kick off the event at lunchtime.
These publications will give the pulse of the health of the financial sector, but will also provide valuable food for thought regarding the economic situation in the United States, where the latest indicators have been solid.
After the spectacular start to the year signed by the world stock markets, these results will above all allow us to know whether the valuations considered high for American stocks are justified.
According to FactSet data, the results of companies listed on the S&P 500 should have increased by 3.2% on average year over year, their third consecutive quarter of growth.
But the price-earnings ratio (PER) of the S&P 500 index currently stands at 20.5x, a level well above its long-term average of 17.7x.
Yesterday, the Nasdaq gained almost 1.7% thanks to a clear rebound in the ‘Magnificent Seven’, in the hope that their quarterly performances will benefit from the enthusiasm currently surrounding AI.
According to analysts, however, it will take solid results, and not just from technology giants, to push stock indices out of their current fluctuation range.
If an improvement in company accounts were to indeed materialize, stocks should benefit since this would justify an increase in prices on the basis of unchanged valuation ratios.
‘Positive announcements would encourage a recovery in stocks,’ says César Perez Ruiz, head of investments and CIO at Pictet Wealth Management.
‘An increase in all sectors would reinforce our optimism regarding American stocks,’ underlines the strategist.
But the opening of the results season will not completely forget the unknown of inflation and investors will carefully scrutinize the price indices which will be published in the morning in France, Germany and Spain.
The indicator agenda also includes US import price figures, as well as the University of Michigan Consumer Confidence Index.
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