The Paris Stock Exchange ended up 0.33% on Thursday, after a turbulent second part of the session and marked by the decision of the European Central Bank (ECB) to raise its rates sharply.
The star CAC 40 index advanced by 19.98 points to 6,125.90 points, for its third consecutive slight increase. Over the first four sessions of the week, it fell by another 0.67%.
The Parisian rating spent the first part of the session stable, before falling quite sharply, beyond -1%, during the speech of the President of the ECB, Christine Lagarde. But the east coast then rose again.
Caught up by record and persistent inflation in the euro zone, 9.1% over one year in August, the Frankfurt institution accelerated the tightening of its monetary policy on Thursday by deciding to raise its interest rates by a unprecedented scale since its creation in 1999: 75 basis points.
Serving as a reference in a context of abundant liquidity, the rate on bank deposits at the ECB, reduced from -0.5% to 0% in July, thus rose to 0.75%.
But this decision is not a surprise and had been telegraphed well in advance, reacted Gilles Guibout, manager of Axa IM, to explain the moderate reaction of the market.
Investors were most affected, he said, by Ms. Lagarde’s warnings about the persistence of inflation: We are still far from the rate that will help bring inflation down to 2%. And we will continue the increases, she added.
The effect was more visible on the debt market: the interest rate on the French 10-year loan rose to 2.22%, against 2.14% on Wednesday. It is once again approaching its peak for the year, 2.38% in mid-June.
More generally, stock market indices are under pressure from rising interest rates and the risk of a downward revision of company results. We expect a decline for the end of the year, which has already been taken into account by the market, but will the decline be in line with expectations?, asks Mr. Guibout.
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Atos shares at their lowest since 1993
The title Atos suffered from the degradation of its rating by analysts at Goldman Sachs and plunged 15.14% to 8.80 euros, the lowest since 1993, according to Bloomberg. The action has fallen by more than 76% since January 1. The price has even been divided by more than ten since the end of 2017, when it was worth more than 100 euros.
Financiers take advantage of rising interest rates
The decided and future rate hikes allowed financial companies, especially banks, to take advantage of the trend. Socit Generale took 2.62% to 23.07 euros, BNP Paribas 1.99% to 47.44 euros and Crédit Agricole 1.36% to 9.21 euros. The insurer Axa also took 2.78% 24.38 euros.