After having experienced its best vintage last year since 1999, the Paris Bourse is about to close above 7,200 points for the first time in its history, driven by the hope that the outbreak of contamination at Omicron will not will not hinder economic recovery. Growth in manufacturing activity has also continued on both sides of the Atlantic.
According to surveys carried out by IHS Markit. The index was revised down from marginal by 0.1 point to 57.7 in final December data in the United States, after 58.3 in November and was confirmed at 58 points in the euro zone (58.4 the preceding month). A figure above 50 reflects an expansion of the activity. Trading volumes, however, remain symbolic with just 1.3 billion euros traded on Cac 40 values due to the closure of several financial centers on Monday, including the London Stock Exchange.
Wall Street procrastinates in the first half hour after the S&P 500 jumped nearly 27% last year. The managers’ favorite index is around thirty points from its highest after setting 70 records in 2021. It has recorded an average increase of 1.6% over the first calendar week in 11 of the last 13 years, according to data compiled by Bank of America. You’re here up nearly 10% after reporting 308,600 deliveries in the fourth quarter. An unprecedented performance for the manufacturer of electric cars and which should have increased its sales to around 87% last year. General Motors and Ford follow with gains of 3% and 5% respectively.
Around 4 p.m., the Cac 40 progressed by 0.93% to 7,219.75 points after a new record during the session at 7,245.66. In Frankfurt on Dax appreciates 0.74% and the index Stoxx Europe 600 takes 049% after a new all-time high at 491.43 points. At New York, the Dow Jones cluster 0.12% and the Nasdaq Composite 0.20%.
Reasonably optimistic markets
In Asia, Tokyo, Sydney and mainland Chinese markets were closed on Monday. In Hong Kong, the Hang Seng index fell 0.53% this morning after losing 14.1% last year, one of the worst performances among the major world markets. Evergrande shares were suspended from listing. The real estate developer, who did not honor the payment of coupons linked to a bond in the amount of $ 255 million due last Thursday, remains in a delicate situation. However, he has a grace period of 30 days to honor this payment.
Investors want to be reasonably optimistic that while the Omicron variant is significantly more contagious than previous strains, it is also known to be less dangerous, which is reflected in the hospitalization data. The risks to the economy linked to the pandemic are expected to decrease, especially as China is on the way to easing its monetary policy.
Generally, ” our economists expect less disruption in economic activity and anticipate above-trend global growth in the first quarter, particularly in Asia. Regarding the Fed’s monetary tightening, the peak of disruption for the markets is also close “, Summarize the strategists of JPMorgan based in Hong Kong in a note quoted by Bloomberg.
Oil and the automobile in sight
Investors will keep an eye on the development of inflation and the response of central banks. Many strategists, including those at Citi, predict increased volatility in the face of these unknowns. The week will be marked in particular by the first estimate of December inflation in the euro zone, as well as by the employment report for the same month in the United States. The Fed will also publish, Wednesday evening, the “minutes” of the meeting of its monetary policy committee on December 14 and 15.
TotalEnergies gains 2.4% and Vallourec almost 7%. Libya has reduced production due to ongoing repairs to facilities damaged by attacks on several fields in the country. Opec + is due to meet on Tuesday to discuss an increase in production in February. The market estimates that the expanded cartel should stick to an increase of 400,000 barrels per day next month.
Saffron is 1.6%. Its managing director, Olivier Andriès, estimates in an interview with Figaro that the worst is over for the aeronautics sector and says he is “very confident”. Airbus advance for its part of 2.9%.
Air France-KLM 4.8% advance and ADP 3.7% while Citi raised its recommendation on the two securities to “sell” to “neutral”.
Michelin (+ 2.3%) signs a new record while Oddo BHF raised his target price from 160 to 175 euros while maintaining his opinion of “outperformance”. Great (+ 0.7%), Schneider Electric (+ 2%), Pernod Ricard (-0.2%) and Teleperformance (+ 1.2%) also hit new highs.
Finally, Renault gains 2.8% and Stellantis 3.5% in the wake of the Stoxx 600 in the automotive sector, the strongest sector increase in Europe with a gain of 2.5% after a 25% jump last year, the most marked since 2013.