After an attempted start at the opening, the Paris Bourse gave ground, investors limiting the risks to two days of the publication of US inflation figures, likely to strengthen expectations of Fed rate hikes. ” There is still a lot of aggression [monétaire] to be included in the price of assets and this could cause sales on the markets this week, and more particularly on growth stocks which should feel more the effects of higher rates than value », Warns Ipek Ozkardeskaya, senior analyst at Swissquote.
The good European statistics of the day have little impact on the trend, which is entirely focused on the development of the fixed income markets. The unemployment rate slowed down to 7.2% in November in the euro zone, as expected, after 7.3% in October. However, companies report that the labor shortage is weighing on production. The Sentix index of investor confidence recorded a surprise improvement to 14.9 points in January after 13.5 in December (13 expected).
Verst 2:30 p.m. on Cac 40 ceded 0.64% to 7,172.96 points in a relatively strong business volume of nearly 1.6 billion euros. The contracts futures March on American indices moved between a decline of 0.3% for the Dow Jones and 1.3% for the Nasdaq 100.
Towards an inflation rate of 7%?
On Friday, the S&P 500 and the Nasdaq Composite experienced their fourth consecutive decline, weighed down by job creations half as many as expected in December. At the same time, the sharper-than-expected drop in the unemployment rate and the continued rise in the average hourly wage underscore the need for the labor market to continue to suffer from a labor shortage. .
Analysts expect inflation to continue rising in December across the Atlantic. It hit a nearly forty-year high of 6.8% in November and the consensus formed by Bloomberg anticipates a further surge to 7%. In the “minutes” of its last meeting, the Fed warned it could raise interest rates faster than expected before tackling its balance sheet reduction. Three rate hikes are planned this year, according to projections released in December.
Goldman Sachs expects the Fed’s monetary policy normalization to accelerate with four tightening this year. ” We continue to anticipate rate hikes in March, June and September, and now expect another in December, for a total of four in 2022 », Wrote Jan Hatzius, strategist of the bank in a note. He further estimates that the Fed should begin the process of reducing its balance sheet, which reached $ 8.8 trillion in December, from July, if not earlier. For now, the market estimates the probability of four rate hikes this year at 50%. Investors could also have a new light on the Fed’s strategy with the hearing on Tuesday of Jerome Powell by the Senate Banking Committee as part of his appointment to a second term at the head of the Fed. That of Lael Brainard, for the post of vice-president, will follow Thursday.
Atos misses its targets for 2021
The yield on the 10-year US bond hovers around 1.77% after touching 1.8064%, its highest level since January 2020. It was 1.51% at the end of 2021. In negative territory for almost three years, that of the German Bund of the same maturity reached -0.025%, its highest since May 2019, before falling back to around -0.051%. In question, the new surge in inflation, both across the Rhine and in the euro zone, where it reached a record of 5% over one year in December, leading some to believe that the ECB will have no other choice than to raise rates despite denials by the central bank.
Technology stocks, which have benefited from a low interest rate environment over the past two years, are the most affected. At European level, the associated Stoxx 600 shows the largest sectoral decline (-2%). STMicroelectronics, Worldline and Teleperformance yield more than 3%.
Atos fall of 17.2% after having once again missed its 2021 objectives. 2.4% at constant exchange rates when the group said it expected stable revenues. In addition, the operating margin stood at around 4% in 2021, against a target of around 6%.
Conversely, the values linked to tourism remain surrounded. ADP takes 21%, Air France-KLM 2.3% and Accor 2.1%.
Among other analysts’ notes, Jefferies degraded Eurofins Scientific (-4.6%) from “buy” to “keep”, while Citi moved to “sell” on Schneider Electric (-3.1%).
Finally Ubisoft advance of 4%. US mobile game publisher Zynga has agreed to be acquired by Take Two Interactive at a price of $ 9.86 per share, for a total valuation of $ 12.7 billion. Zynga jumped nearly 48% on the New York pre-market.