Up 2.81% at best, 0.71% at worst: the Paris Stock Exchange stayed away from the red zone on Friday but volatility, again, was not an empty word. It is omnipresent in Europe as in the United States, where the three major indices, Nasdaq Composite in the lead, tipped into the red shortly after the release of the University of Michigan consumer confidence index for October. While household sentiment improved more than expected, with the indicator standing at 59.8 versus 58.6 in September, the survey shows that inflation expectations have risen. This component is closely watched by the Federal Reserve (Fed). It puts a kick in the expectations of experts who saw in inflation in September the last burst before the lull. Last month, the consumer price index (CPI) rose 8.2% year on year in the United States, against 8.3% in August and 8.1% expected, and 6.6% in core (excluding food and energy), against 6.3% expected. On a month, the CPI rose by 0.6% (in line with last month), with more rigid components which again drove the increase.
“Upward pressure on rents”
” IIt should be noted that housing has been firm, as higher rates, counterintuitively, put upward pressure on rents by making home ownership unaffordable. This momentum should continue until house prices fall enough to start weighing on rents. Meanwhile, lower input prices are not being passed on to consumers, and core goods inflation has also remained firmanalyzes Tiffany Wilding, US economist at Pimco. For the Fed, this increases the pressure to cool the economy even further. »
At the close, the Bedroom 40 gained 0.9%, to 5,931.92 points, in a trading volume of 3.4 billion euros. On the securities front, US banks entered the ball rolling for the results season as of September 30. With varying fortunes. Morgan Stanley loose nearly 4% after quarterly results below expectations, particularly in the investment banking division, whose revenues have dropped by 55% over one year. Citigroup suffered similar setbacks in investment banking and its provisions for credit losses jumped, but that didn’t stop the stock from advancing 2.3%, buoyed by rising revenue thanks to the rally interest rates. Same causes, same consequences JPMorgan Chasebut its net interest income having jumped 34%, more than Citigroup, its title is gaining more ground (+3.1%).
FDJ raises its forecasts
In Paris, TotalEnergies gained 1.75%, supported by the International Energy Agency’s warning of the risk of soaring oil prices after the OPEC+ decision to reduce its production quotas. Another element of support: Barclays reiterated its recommendation to “overweight”, Exane BNP Paribas and Oddo BHF to “outperform”. For its part, JPMorgan lowered its price target to Thales from 150 to 143 euros, while maintaining its “outperformance” opinion.
Finally, the title Lotery (FDJ) rose 1.97%. The gambling operator has raised its 2022 targets after revenue growth of 12% in the third quarter. It is now targeting a turnover growth of more than 8% and an EBITDA margin (gross operating surplus) of around 24% this year.
PC