The Cac 40 in the red before Jerome Powell’s speech from the Bank of Sweden


Posted Jan 10, 2023, 2:26 PMUpdated on Jan 10, 2023 at 2:31 PM

The Paris Stock Exchange barometer is consolidating after returning to levels not seen for almost a year. Investors are wary of any initiative after the “hawkish” remarks made on Monday by two Fed officials and the approach of an intervention by Jerome Powell.

Around 2:30 p.m., the Bedroom 40 lost 0.86% to 6,848.12 points in a business volume of 1 billion euros. The contracts future on American indices yield between 0.4% and 0.6%. Boeing fell 2.6% in pre-market following a degradation of Morgan Stanley, from “overweight” to “online weighting”.

Scheduled for 3 p.m., the Fed Chairman’s speech at the Bank of Sweden’s (Riksbank) Annual Symposium precedes the publication of December inflation figures in the United States by two days. Markets applauded Friday’s slowing wage growth reflected in the December jobs report. But comments from San Francisco Fed President Mary Daly and her Atlanta-based counterpart Raphael Bostic took markets by surprise, with both officials judging the Federal Reserve should raise interest rates. interest beyond 5% and keep them at that level for some time yet.

Powell could readjust his speech

It’s the discrepancy between what Fed officials are saying and what the market has priced in that has fueled the debate since the start of the year., notes Michael Hewson, chief market analyst at CMC Markets. And to add that the rebound in equity markets having the effect of easing financial conditions, this Tuesday could be an opportunity for Fed Chairman Jay Powell to slightly readjust his speech “.

The bond market has rebounded since the beginning of the year on the back of signs of calm on the inflation front in Europe and the United States, where wage growth has slowed. On Tuesday, the yield on the US 10-year bond tightened by 5 basis points to 3.5651%. Ditto for that of the German Bund of the same maturity, which is traded at 2.2710%.

Renault at the top of the Cac 40, EssilorLuxottica downgraded

Renault appreciated by 2.6% after its decline the day before. Goldman Sachs raised its price target on the stock from 33 to 38 euros, while maintaining its opinion at “neutral”. The car manufacturer has signed a strategic partnership with the Italian engine manufacturer Punch Torino in the field of low-emission diesel engines.

EssilorLuxottica loses 2.7%. RBC downgraded the title of the eyewear maker from “online performance” to “underperformance”.

Among other analyst ratings, Goldman Sachs lowered Valeo from “buy” to “neutral”. The action of the automotive supplier yields 2.3%.



Source link -90