The Paris Stock Exchange is hesitant, torn between questions about health restrictions in China and the expectation of two major meetings in the United States this week: the results of the Midterms and the inflation figures. These should have repercussions on the Fed’s monetary policy, especially since the employment figures published last Friday confirm that the labor market remains under tension.
Around 9:30 a.m., the Bedroom 40 was stable at 6,4132.25 points (-0.05%) in a business volume of 260 million euros.
The Hong Kong Stock Exchange’s Hang Seng index closed up 2.7%, boosted by the continued rise in technology stocks, as well as that of the real estate sector. The denial by the health authorities to rumors of a relaxation of the zero Covid policy, which will be ” unfailingly maintained, is offset by the feeling that Beijing will eventually have to slow down in the face of a slowing economy. Especially since excessive restrictions have prompted some cities like Zhengzhou to call for more targeted measures. It is also in this region that most of the iPhones sold in the world are manufactured. Apple estimates it will produce 3 million fewer iPhone 14s than originally planned this year due to weaker-than-expected demand, according to Bloomberg.
Chinese foreign trade in the red
Chinese foreign trade figures reinforce this sentiment. Exports expressed in dollars fell 0.3% year on year in October, their first contraction since May 2020, while imports fell 0.7%. ” Sentiment is so weak on Chinese stocks that any potential catalyst is likely to cause a rally said David Chao, market strategist for the Asia-Pacific region excluding Japan at Invesco.
In the United States, attention is focused on the midterm elections, scheduled for Tuesday. At stake, the renewal of all the seats in the House of Representatives, a third of those in the Senate, the election of governors in 36 states, as well as important elective functions in many states. The Democrats currently control the House and have a slim majority in the Senate. In particular, the Chamber has control of the budget, a key issue for the continuation of Joe Biden’s presidency.
Towards a slowdown in US inflation?
Expected Thursday, the consumer price statistics could mark the beginning of a lull, but not enough to influence Fed policy. The consensus expects the inflation rate to slow to 8% over one year after 8.2% in September. Several officials like Susan Collins, president of the Boston Fed, Thomas Barkin (Richmond), Chris Evans (Chicago) and Neel Kashkari (Minneapolis) have said they favor a smaller rate hike in December after four consecutive hikes of 75 basis points which took the Fed funds rate to a range of 3.75% to 4%. Analysts estimate that the final rate could exceed 5% next year.
Renault rose 2.6% on the eve of its investor day. The automaker also plans to value its electric business at around 10 billion euros, Bloomberg reports, citing people familiar with the matter.
Orpea down 3.8%. The manager of Ehpads is looking for nearly 2 billion euros in capital as part of the restructuring of its debt, according to sources cited by the same press agency.
Thales lost 1.3% as JPMorgan downgraded the title of the specialist in defense electronics from “overweight” to neutral”.
TF1 appreciated by 0.9%. The channel and Canal+ (Vivendi group) have announced that they have signed a new distribution agreement.
Worldline gains 0.7%. The electronic payments specialist has announced the signing of a firm agreement to acquire the merchant acquiring activities of the Italian bank Banco Desio for around 100 million euros.