The Paris Stock Exchange is anchored in the red, since the opening on Tuesday. And the loss is accentuated even a little in the middle of the afternoon, while Wall Street reopens down after a three-day weekend linked to Memorial Day, a holiday across the Atlantic.
Around 4 p.m., the Bedroom 40 drops 1.48%, to 6,465.08 points, in a meager volume of 1.41 billion euros. In New York, the Dow Jones fell 1.23%, weighed down in particular by its oil components, against a backdrop of an oil surge while, last night, European leaders managed to ratify an embargo on Russian oil. It will, however, be in two stages. It will first concern maritime deliveries by the end of the year, then, ” as fast as possible », the crude delivered by pipeline. The other measures of the sixth sanctions package against Moscow will come into force soon. Brent from the North Sea climbs to 124 dollars a barrel while the American WTI is at 119 dollars. In Paris, TotalEnergies evolves on four-year highs but only gains 0.69%, against a rise of nearly 1.5% at the high of the day. Excluding the flagship index, GTT recovers almost 3%.
8.1% inflation over one year in the euro zone
The other brake for the markets is linked to the publication, at the end of the morning, of inflation in the euro zone above expectations in May, peaking at 8.1% over one year, beyond the 7, 5% in April and 7.8% expected by the Bloomberg consensus. The opposite would have been surprising, given the figures that were presented yesterday in Germany and Spain, where price increases accelerated to peaks of 8.7% year on year in both countries. In France, inflation rose to 5.8% in harmonized data for the month of May.
” Headline and Core Inflation [+3,8% après +3,5% en avril, en raison de l’augmentation des prix des services et des biens non énergétiques] rising again more than expected, the case for a quick exit from negative interest rates is now compellingJudge Andrew Kenningham, of Capital Economics. The ECB should now confirm that it will raise rates in July and we believe it will leave the door open for a 50 basis point hike. » The increase linked to energy amounts to 39.2%, against 37.5% in April. That related to food went from 6.3% to 7.5% in the space of a month, ” it should increase further in the coming months due to supply problems linked to Ukraine. »
” Not fast enough… ”
The recovery in activity observed in China in industry and services has had no effect on the trend. Presented this morning, the official PMI of purchasing managers in the manufacturing sector stood at 49.6 points in May, up from 47.4 points in April and even the 49 expected by the consensus. . A level that remains, however, below the 50-point mark, which separates the growth phase from the contraction phase compared to the previous month. The services component also recovered, to 47.8 points, after falling to 41.9 in April.
For Bo Zhuang, at Loomis Sayles, interviewed by CNBC, “ things…are getting better, but not enough. The worst of China’s Covid wave growth shock may have passed, but the country is still seeing very gradual and slow progress in normalization “.