The Paris Stock Exchange is down slightly on Monday morning, torn between the progression of Wall Street and Asian markets and the prospect of new Western sanctions against Russia. Discussions between Russian and Ukrainian negotiators should nevertheless resume on Monday.
At 9:35 a.m., the Bedroom 40 lost 0.34% 6,661.62 points in a business volume of 280 million euros.
Biggest increase in the Cac 40, Thales increased by 3%. Another defense value, Dassault Aviation wins 2.4%. Sanofi takes 0.5% after announcing that the Food and Drug Administration (FDA), the US health authority, had agreed to give priority review to its drug Dupixent for the treatment of patients 12 years and older with esophagitis with eosinophils. Technology stocks, on the other hand, lost ground, such as Worldline (-2.4%) and STMicroelectronics (-1.1%).
The European Union is considering imposing new sanctions against Moscow following the broadcast of images of massacres against the civilian population in the town of Boutcha, on the outskirts of kyiv, after the departure of Russian troops. In a message posted on Twitter on Sunday, Charles Michel, the President of the European Council, indicated that new retaliatory measures would be adopted against Russia. European Union ambassadors are expected to meet on Wednesday to discuss a new sanctions package, reports the FinancialTimes citing diplomatic sources.
No Putin-Zelensky meeting yet
Russian chief negotiator Vladimir Medinsky said on Sunday that the conditions for a meeting between Vladimir Putin and Volodymyr Zelensky have not yet been met for lack of a draft written peace agreement. He nevertheless announced that the discussions should resume by videoconference on Monday, information which has not been confirmed by the Ukrainian authorities.
In Hong Kong, the Hang Seng rose nearly 2% this morning, driven by tech stocks as Beijing reportedly is willing to ease rules banning Chinese companies from providing certain financial information to foreign regulators. An orientation that could allow the United States to have access to the audits of these companies, thus reducing the risk of withdrawal from the American listing. Chinese markets were closed on Monday due to the tomb cleaning festival.
High volatility on the interest rate markets
Fixed income markets remain under pressure in anticipation of a slowdown in growth against a backdrop of soaring prices. The yield on the 2-year US bond is stretching to 2.4851%, against 2.4136% for the 10-year maturity, thus reflecting fears of recession in anticipation of a tightening of policy by the Federal Reserve US, which is expected to raise rates by half a point in May. The Fed is due to release the “minutes” of its March monetary policy committee meeting on Wednesday. The report should also give indications on the reduction of the amount of its balance sheet.
While volatility remains high in bond markets, falling buying and the feeling that there is no alternative to equities favor equities, especially as the solid job market in the United States reflects that of the US economy in an environment where real interest rates remain negative due to ultra-accommodative monetary policies.