The Paris Stock Exchange and Wall Street are consolidating after a relief rebound which has allowed the Cac 40 to rebound by more than 6% in three days, and the S&P 500 to gain 5.7% in two sessions, unheard of since March 2020. Conflicting statistics on both sides of the Atlantic have put this movement on hold for the moment, especially since an OPEC+ committee has recommended a reduction of 2 million barrels per day of the production of the expanded cartel, according to sources cited by Bloomberg. If this recommendation were endorsed, this decrease would be the largest since 2020. A barrel of Brent from the North Sea appreciated by 0.8% to 92.25 dollars. TotalEnergies takes 1.3%.
Around 4 p.m., the Bedroom 40 lost 1.18% to 5,968.20 points. In New York, the Dow Jones yields 1.06% and the Nasdaq Composite 1.82%.
The specter of recession hangs over the eurozone
” The higher energy prices are, the more central banks have to rein in demand to bring them down. That’s why a big OPEC production cut could well have an undesirable effect and lead to profit-taking and a drop in oil prices today. “, explained this morning Ipek Ozkardeskaya, senior analyst at Swissquote.
In the euro zone, private sector activity contracted again, the composite PMI index (synthesis between industry and services) compiled by S&P Global fell by 0.8 points to 48.1, its lowest level since January 2021.” The final PMI indices for the month of September suggest that price pressures in the region have not yet started to ease, although activity appears to be declining. We believe that some economies, including Germany, are already in contraction and expect the whole of the Eurozone to fall into recession in the fourth quarter. commented Jessica Hinds, Senior Economist for Europe at Capital Economics.
In the United States, the private sector created 208,000 jobs in September, according to ADP, against an estimated 200,000 and 185,000 in August (revised from 132,000). The statistics show that the slowdown needed to bring inflation down is not yet in sight. Observers are now relying on the official Labor Department report to be released on Friday. The sharp fall in job offers in August, the sharpest in almost two and a half years, had helped to maintain the feeling that the Fed could opt for a more flexible approach to its monetary policy.
Actions not yet out of the woods
But the statistic will not prevent further aggressive rate hikes in the short term. ” An accommodating inflection [des banques centrales] requires more indications pointing to weaker growth and a decisive slowdown in inflationinsists Emmanuel Cau, head of European equity strategy at Barclays. We don’t think equities are off the hook just yet “, he insists.
The debt market is under pressure again, the yield on the 10-year US bond is up 12 basis points at 3.7218% and that of the German Bund with the same maturity by 6 basis points at 1.9710 %.
Banking and automotive stocks are the most affected with declines of 4.8% to 8% for Michelin, Faurecia and Valeoand around 3% for BNP Paribas, Agricultural credit and Societe Generale. Also sensitive to changes in the economy, commercial real estate Unibail-Rodamco-Westfield fall of almost 7%.