The Paris Stock Exchange gained 1.57% on Wednesday, propelled by the slowdown in inflation in the United States which could encourage the American central bank to adopt a more accommodating monetary policy.
The star CAC 40 index gained 113 points to 7,333.01 points, its strongest increase since June 2. It recovered 3.11% over the week, offsetting most of its losses the previous week (-3.89%).
The Parisian stock market opened higher, but the trend intensified significantly in the second half of the session, after the publication of the American inflation indicator CPI.
Inflation slowed again sharply in June in the United States, 3% over one year against 4% the previous month, and thus reached its lowest level since March 2021.
We have entered a period of normalization, with monthly price changes of around 0.2%, as in the pre-Covid period, notes Patrice Gautry, chief economist of the Private Banking Union. Excesses are shrinking, even in volatile sectors, such as new cars, or the price of plane tickets, he adds.
Other good news, core inflation, i.e. not taking into account food and energy prices, fell to 4.8% over one year, against 5.3% the month previous year, at a lower rate than forecast.
If inflation is still below the 2% rate targeted by the central bank, the trend will allow for more balanced debates on the institution’s response to the situation, with more weight for members asking for a flexible position, according to Mr. Gautry.
The markets had known last week a warning shot by noting the determination of the Fed on future rate hikes, describes the economist.
While a further rise in the key interest rate in July seems to have taken place at the head of the market, they now believe that a second rise at the next meeting is unlikely.
As a result, interest rates on government loans fell sharply on the bond market. The rate for the French 10-year loan fell to 3.09%, against 3.21% on Tuesday.
Casino Speculation
The heavily indebted Casino group climbed 10.75% to 3.32 euros, investors rejoicing in the possibility that the two groups of contenders for the takeover of the brand will increase their offer, according to Les Echos.
Rallye also took 6.98% 0.97 euro.
Dissonant notes
The semiconductor sector benefited from a recommendation from analysts at Jefferies: STMicroelectronics gained 4.68% to 46.49 euros, and Soitec 6.59% to 161.80 euros.
Conversely, Air-France-KLM fell 3.80% to 1.63 euros after Deutsche Bank analysts expressed concern about the ability of European airlines to maintain ticket prices as high as they are today.
Thales will spend a billion euros on AeroComms
The French technology group Thales announced on Wednesday that it had entered into exclusive negotiations to acquire Cobham Aerospace Communications (AeroComms), a company providing safety communication systems for cockpits, for 1.1 billion dollars.
The price of the acquisition is considered reasonable in a note from Jefferies, the operation being considered positive for the company.
Its action gained 3.01% to 137.10 euros.