The Paris Stock Exchange is up slightly, supported by generally favorable corporate results in the United States and Europe, as well as the prospect of a possible reopening of the Nord Stream 1 gas pipeline on Thursday, as expected. In the meantime, the market is awaiting Mario Draghi’s decision on whether or not to retain the post of Chairman of the Council against a backdrop of political crisis in Italy. And this, on the eve of the monetary decision of the European Central Bank
Mid-session, the Bedroom 40 gained 0.35% to 6,222.83 points in a business volume of 600 million euros. Elsewhere in Europe, the Dax of the Frankfurt Stock Exchange takes 0.41% and the FTSE Eb Milanese 0.21%. The contracts future on US indices rose by around 0.2%.
The next two days will be important in Europe with the issues of gas flows, the future of Draghi, the anti-fragmentation mechanism, and ‘last but not least’, whether the ECB will opt for a 25 or 50 basis point hike in interest rates tomorrowwrote Jim Reid of Deutsche Bank in a note this morning. The very fact that we are looking at a 50 basis point hike could potentially have an impact on the ‘forward guidance’ which could be trampled by the power of inflation “, he concludes.
Draghi in the hot seat
In a speech before the Senate this morning, Mario Draghi said he had heard the calls for him to remain in his post as President of the Council, and that he was ready to respond favorably, while insisting on the need to rebuild the unity of the government coalition with ” courage, altruism and credibility “. In other words, he will only stay if the parties are united behind him and his political agenda. The debates will continue until the vote of confidence, scheduled for the end of the afternoon. He had already presented his resignation to the President of the Republic last week, who rejected it, following the refusal of the 5 Star Movement to vote for a package of support measures.
His decision will be scrutinized by the European Central Bank on the eve of the meeting of its Board of Governors. The ECB has warned the markets that on this occasion it will carry out its first monetary tightening in 11 years. The increase could reach 50 basis points, against the 25 announced last month, according to sources quoted by Bloomberg, in exchange for an agreement on the anti-fragmentation mechanism intended to protect the most fragile economies in the euro zone, including Italy.
Carrefour sells its activities in Taiwan
Either way, anticipation of a bigger than expected rate hike is supporting the euro, which is trading at $1.0242, which has the effect of containing the oil bill, denominated in the currency American. The barrel of Brent from the North Sea, sensitive to fears of recession and the evolution of the greenback, yielded 1.1% to 106.20 dollars.
Crossroads increased by 2.3%. The distribution group has announced the signing of an agreement to sell its 60% stake in Carrefour Taiwan to the Uni-President group, a decision which marks the refocusing of the French distributor on Europe and Latin America. The price of this operation could reach 1 billion euros.
Publicis rises as much. The American Omnicom reported growth in earnings per share to $1.68 in the second quarter and an improvement of 0.7 points to 15.8% in its gross operating profit margin. Publicis is due to present its quarterly results on Thursday.
Main supporter of the Cac 40, TotalEnergies gained 1.1% while HSBC raised its price target from 57 to 60 euros.
Virbac on the contrary gives up 5%. The veterinary drug producer has confirmed that it expects organic growth of 5% to 10% of its turnover this year after the publication of a 13.5% increase in its revenues to 298.3 million euros in data. published in the second quarter, and 7.8% at constant exchange rates and perimeter.
Amundi takes 0.6%. Goldman Sachs started monitoring the asset manager at “buy” to target 65 euros.
At the European level, Unite moved to the top of the Stoxx 600 with a jump of 16% following information from the Handelsblatt that the details of its recapitalization by the government could be discussed with Chancellor Olaf Scholz on Friday.