The Cac 40 is installed in the green this Monday. If the day is a public holiday for Pentecost, the stock markets are open. In the middle of the morning, the Cac 40 rose by 1.1%, to 6,560.45 points.
In the United States too, it’s time to rebound after Friday’s red session. Late last week, the Dow Jones, S&P 500 and Nasdaq Composite fell 1.05% to 2.47% as strong May jobs data dampened hopes of a the Federal Reserve paused in the tightening of its monetary policy. The United States created 390,000 jobs in the non-agricultural sector last month, more than the 328,000 anticipated by the consensus, with no unpleasant surprises on wages, up 5.2% over one year, as expected. A rebound is expected this afternoon across the Atlantic.
ECB and US inflation in sight
It is in this context that we will closely monitor the inflation figures which will be published at the end of the week in the United States (Friday at 2:30 p.m.). According to the Bloomberg consensus, consumer price inflation should have stabilized over one year in May, at 8.3%, while having increased by 0.5% over one month. Excluding food and energy, that is to say excluding volatile elements, a decline to 5.9% over one year is nevertheless expected, after 6.2% in April. Also to follow, on the same day, the evolution of the consumer confidence index according to the University of Michigan.
Another highlight of the week, Thursday, with the monetary policy decision of the European Central Bank and the press conference of its president Christine Lagarde. The ECB is expected to announce the end of asset purchases and set the stage for a first rate hike in July. The uncertainty relates to the magnitude of the movement. Will the tightening of the refinancing rate (refi rate) be 25 or 50 basis points? Opinions seem to be divided within the monetary institution, which promises great debates between doves and hawks. Inflation in the euro zone increased further in May, to 8.1%, against 7.4% in April.
In China, the Caixin index of purchasing managers in services was unveiled on Monday at 41.4 points, a strong improvement compared to 36.2 points in April, but still in the contraction zone. On the oil front, Brent is at $120 a barrel.
Jefferies positive on aeronautics
On the values side, Airbus and Saffron gained more than 2%, driven by a favorable rating from Jefferies. While major economies face supply chain challenges and worries about entering recession, the sector’s recent 10% drop in the stock market offers opportunities, the research office said. Airbus is thus “reintegrated into the sector’s Top Pick” by the firm, which judges that short-term production challenges should not overshadow Airbus’ ability to double its operating profit by 2025. In defence, Thales (+1.4%) is considered the most attractive thanks to its solid order book.
The automobile is also surrounded. Renault and Stellantis take from 1.7% to 2.2%, Faurecia and Valeo more than 3%.
Societe Generale advance of 2.4%, benefiting from a change in recommendation from Jefferies, still from “hold” to “buy” to aim for 35 euros, against 25 euros previously.
Conversely, EDFdowngraded from “keep” to “reduce” by HSBC, lost 2.2%.