The Paris Stock Exchange is consolidating flat after a largely positive start to the week. The disappointing quarterly reports of Gafam confirm that no sector, apart from energy, has escaped economic deterioration. Although growth slowed in France in the third quarter (+0.2% after +0.5%) and recorded a jump in Germany (+0.3% after +0.1%), the inflation rate established records at respectively 7.1% over one year in October in France and 11.6% across the Rhine, in harmonized data from the European Union. Soaring prices are increasing pressure on the ECB ahead of Monday’s release of the consumer price index for the eurozone as a whole.
In the United States, household spending increased by 0.6% in September and income by 0.4%, against an increase of 0.4% expected in both cases. The “core” PCE index of personal consumption expenditure, the measure of inflation most watched by the Fed, rose 5.1% year on year, against 4.9% in August and an estimated 5.2%. To follow, the final index of consumer confidence from the University of Michigan for the month of October, and in particular the component of 1-year inflation expectations.
Shortly before 3 p.m. Bedroom 40 lost 0.20% to 6,231.83 points in a business volume of around 1.45 billion euros. The index is currently gaining 8.2%, thus signing its first monthly increase since July (+8.9%). The contracts future on American indices oscillate between a gain of 0.6% for the Dow Jones and a decline of 1.6% for the Nasdaq 100. Amazon drop of nearly 14% in pre-market trading. The online retail giant announced last night that lower consumer spending is expected to affect its sales over the holiday season. Apple is reported up 0.5% after beating earnings expectations. However, revenues from services were disappointing, especially as the group acknowledges being penalized by the strength of the dollar. Conversely, Exxon Mobil and Chevron rose 2% after announcing record quarterly profits, for the first, and near-records for the second, in the third quarter.
Sanofi and Danone lead the Cac 40, Air France-KLM falls
Danone gains 2.6%. The agribusiness giant has raised its financial targets for the current year after posting a strong increase in sales in the third quarter, driven by price increases.
Sanofi increased by 2.5%. The pharmaceutical group has revised its net earnings per share (EPS) forecast for its activities in 2022 slightly upwards, after a 9% growth at constant exchange rates in its sales in the third quarter, supported by specialty medicine and vaccines.
Another defensive value, Orange appreciates by 1.5%.
Saffron rises 2% The engine manufacturer raised its sales and free cash flow forecasts for 2022, while its sales for the third quarter increased by 29.9% on an annual basis, carried by a dollar strong.
Excluding CAC 40, Air France-KLM fall of more than 14%. Despite quarterly results above expectations, analysts are skeptical about the ability of the carrier to achieve objectives they consider too optimistic.