The Cac 40 accentuates its losses after the announcement of a Fed board meeting next Monday


The Paris Stock Exchange accentuates its decline, investors are alarmed by the risk of a strong reaction from the Fed to the sharp acceleration of US inflation. Fears are all the more acute since the Federal Reserve has indicated on its website that it will hold an unscheduled closed meeting of its board on Monday, February 24, at 11:30 a.m. local time.

An announcement that is jazzing the day after the publication of inflation figures. Some traders questioning the nature of the Fed’s Valentine’s gift. Comments from James, Bullard, who does not rule out the possibility of monetary tightening outside the scheduled meetings of the FOMC, also fuel speculation.

Increases outside FOMC meetings?

At 10:20 a.m., the Bedroom 40 lost 1.28% to 7,010.64 points in a business volume of 700 million euros. March futures contracts on the Nasdaq 100 fell 1.2% the day after a drop of 2.1%.

St. Louis Fed President James Bullard said the surge in inflation has made him ” clearly more hawkish. A voting member of the Fed’s monetary policy committee, James Bullard told Bloomberg that he now favors a 100 basis point hike in the Fed funds rate by July 1.

If he is considered one of the most hawkish members of the committee, the effect was immediate and the contracts future Fed Funds Reports suggest the market is pricing a near 90% chance of a 50 basis point rate hike in March, and a near 95% chance of at least 100 basis points by the end of June. In the bond market, the yield on the US 10-year bond crossed the 2% mark for the first time since August 2019.

Christine Lagarde for a gradual approach

On this side of the Atlantic, the ECB will also have to consider tightening its monetary policy in the face of the return of inflation in the euro zone. Christine Lagarde, however, insists in the German press on the fact that raising interest rates too quickly would not make it possible to stem the rise in prices and would only have the effect of weakening the economy. On the contrary, it advocates a gradual change in monetary policy.

In Germany, the inflation rate was confirmed at 5.1% year on year in January, according to European HICP standards. This figure marks a slowdown from 5.7% in December, while remaining well above the European Central Bank’s target.

Ipsen and Euronext are doing the splits

TF1 gains 1.4%. The television group reported a more than fourfold increase in its net profit to 225.3 million euros in 2021, a year marked by the announcement of the planned merger with competitor M6. Turnover increased by 16.6% to 2.43 billion euros.

Ipsen takes 1.6%. The pharmaceutical laboratory has raised its outlook for 2024, while its turnover and its operating margin from activities exceeded the objectives set for 2022 last year.

Conversely, EDF fell by 3.6% The electrician indicated that it had adjusted its estimate of nuclear production for 2023 to 300-330 Terawatt-hours, against 340-370

Rexel loses 4.5%. The distributor of electrical equipment has announced that it expects a further increase in sales in 2022, after having achieved a turnover last year which it described as “record”. It expects sales growth of between 4% and 6% over one year in 2022, on a like-for-like basis and on a constant number of days.

Euronext gives up 4.7%. The European stock exchange platform has achieved a year that it qualifies as a record thanks to the takeover of Borsa Italiana. Revenues jumped 47% to 1.3 billion euros and gross operating surplus rose 44.8% to 752.8 million. However, Citi points out that the group is being cautious in its cost forecasts for 2022.




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