The control room of Euronext, the company that manages the Paris Stock Exchange (AFP/Archives/ERIC PIERMONT)
The Paris Stock Exchange finished higher for the fourth time in five sessions on Tuesday, driven by the renewed activity in the euro zone in April allowing it to return to 8,100 points.
The flagship CAC 40 index gained 65.42 points, or + 0.81%, to finish at 8,105.78 points, its highest level since April 8. Over the last five sessions, it finished four times in the green and once stable (-0.01% Friday).
This is its strongest progression in one session since March 12.
The main event of the day, the publication of the April PMI Flash index which gives a foretaste of the level of economic activity, pleased investors. In the euro zone, growth in activity accelerated to its highest level in eleven months, exceeding analysts’ expectations.
“The overall picture is good, this confirms the feeling of the European Central Bank”, which had estimated that the worst in terms of economic activity was undoubtedly over, explains Alexandre Baradez, analyst at IG France.
The same index for the United States was less good than expected but, there too, investors welcomed the news with a smile. Unlike Europe, where key rate cuts from the Central Bank are expected with certainty due to progress on inflation and the weakness of the economy, investors are more cautious about the Central Bank’s next decisions American (Fed).
“The fear is that the economy is too resilient,” explains Mr. Baradez because this would encourage the Fed not to lower its interest rates, or very little, which would be bad news for investors.
The publication of the American indicator caused a clear drop in the interest rate of the American State which had repercussions on that of the French State: after having exceeded 3.02% in the middle of the session, the rate 10-year interest rate returned to a rate close to its level the day before, at 3%.
Investors will now focus on company results, with those of almost half of the CAC 40 companies expected throughout the week. Air Liquide, Orange and Eurofins will notably publish their results on Wednesday, before the stock market opens. Kering announced after the closing that it expected a decline in its current operating profit of “40 to 45%” in the first half.
Renault without acceleration
The car manufacturer Renault published a slight increase in turnover (+1.8%) in the first quarter of 2024 thanks to high interest rates on its financial services, which notably offset negative exchange rates.
“Inventories continued to decline, leading to a negative volume effect and below consensus expectations,” note Stifel analysts. The title gained 0.40% to 47.66 euros. Since January 1, Renault shares have climbed nearly 29%.
© 2024 AFP
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