The control room of Euronext, the company that manages the Paris Stock Exchange, in La Défense (AFP / ERIC PIERMONT)
The Paris Stock Exchange rebounded 0.51% on Tuesday after four consecutive sessions in the red, a purely technical effect before assessing the evolution of US inflation over the next two days in a context of economic slowdown.
After a rebound of more than 1% at the opening, the momentum lost momentum as the American markets hesitated, the Parisian CAC 40 index closing up 0.51% at 6,116.91 points.
“Today’s (Tuesday) technical recovery is linked to yesterday’s (Monday) correction,” observed Chaguir Mandjee, portfolio manager at Tailor AM, seeing it as “a bargain-hunting reflex.”
“All markets are waiting for the CPI inflation index in the United States” – which will be published on Wednesday – and investors will mainly be watching the development on a monthly basis to see if the peak in the price acceleration has been reached, added the specialist.
The CPI inflation index in the United States is due on Wednesday and economists are betting on a slight slowdown in the rise in prices to 8.1% year on year, against 8.6% the previous month.
On Thursday, they will monitor the PPI, the producer price index, considered a leading indicator and which analysts see decelerating markedly compared to the previous month.
US President Joe Biden assured Tuesday that “inflation (was) his biggest national priority”, at a time when rising prices are weighing on American households and on his popularity.
However, he said some of the “roots of inflation” were “out of (his) control”, citing the Covid-19 pandemic and the effects of Russia’s war on Ukraine.
To the fear of inflation was added that concerning the growth cycle due to confinements in China, monetary tightening in the United States and the war in Ukraine which raised the price of raw materials.
The prospect of a slowdown in growth poses a risk to corporate results for the second half of the year.
On the value side, EssilorLuxottica (-5.10% to 144.10 euros) posted the largest drop in the CAC 40 index, penalized according to Bloomberg by the warning issued by its American competitor National Vision, which revised downwards its 2022 objectives due to a deterioration in the economic situation.
Other corporate news, Renault will increase its rental and subscription offers under its Mobilize brand, aiming to reap the first profits in these mobility services from 2025. The title of the diamond manufacturer fell 0.36% at 22.38 euros.
© 2022 AFP
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