Past the appointments of the Fed, last night, and inflation in the euro zone this morning, the Paris Bourse is settling into a rather summery rhythm this Thursday afternoon, the Cac 40 contenting itself with nibbling 0, 22% to 6,541.91 points in a meager business volume of 830 million euros. In New York, the indices also point to a slight increase in opening.
Operators were reassured at the end of the morning by the confirmation of inflation figures in the euro zone for the month of July. No upward revision therefore, which would not have failed to create some releases on the equity markets, lest the ECB be forced to accelerate its monetary tightening during its next meetings.
Last month, consumer prices rose 8.9% year on year, as in preliminary data, and 4% excluding food and energy. The fact remains that these figures remain up compared to June, when inflation was 8.6% over one year and 3.7% excluding volatile elements. Over one month, prices rose by 0.1%, as expected.
Little hope for improvement in the eurozone
The outlook for inflation in the euro zone has not improved since the rate hike in July, announced earlier in the morning, Isabel Schnabel, member of the executive board of the European Central Bank. Enough to fuel the suspense about an increase of 25 or 50 basis points in the refi at the next meeting in September, a new turn of the screw, after that of 0.5 point in July, seeming acquired. ” I would not rule out that in the short term inflation will continue to rise. These inflationary pressures are likely to be present for some time, they will not disappear quickly “Admitted Isabel Schnabel.
Yesterday, the American indices had ended down (-0.5% for the Dow Jones, -1.25% for the Nasdaq Composite), even if the operators believed it for a moment, when they were able Read in the minutes that some members of the Federal Reserve feared that the rate hike would have a greater than expected effect on the economy and slow it more than necessary. Enough to hope to see the Fed reduce the scale of its tightening from September (and why not start lowering them from 2023…), which has led the major indices to temporarily reduce their losses.
Optimism quickly showered
However, optimism was dampened by the asserted firmness of the central bank in wanting to curb inflation to its target of 2%. There is no question, in fact, of stopping rate hikes until inflation has fallen sharply, the Fed recalled in its report, while specifying that it will be ” appropriate, at a given time to slow the pace of monetary tightening. The Fed believes that this ” will probably take some time before its decisions have a significant impact on the economy.
A more “hawkish” Fed than expected therefore, summarizes Ipek Ozkardeskaya, of Swissquote Bank, or rather more “ hawkish than necessary to give US stock markets a boost. This morning, the CME tool based on futures contracts on Fed-funds continues to give as the main scenario (59%) a rise of 50 basis points in key rates, in a range of 2.75% to 3%, against 41% for a rise of 75 basis points (3% to 3, 25%).
As for the figures of the day, the “Philly Fed” index, which measures the evolution of activity in the Philadelphia region, recovered more than expected in August, to 6.2 points, against -5 expected and -12.3 in July. The weekly jobless claims amounted to only 250,000, or 14,000 applications less than anticipated by analysts. We are still waiting for the sales of old homes a little later in the afternoon.
Worldline affected by Adyen
Little information from the business side. Within the Cac 40, we will nevertheless note the underperformance of Worldline (-1.1%), in the wake of Dutch Adyen, which fell 10% in Amsterdam after the publication of quarterly results below expectations.
At the SRD, Valneva fell 2.7% as the US Department of Defense decided not to exercise the second annual option of its contract for the supply of Ixiaro, a biotech vaccine against Japanese encephalitis. This option concerned the delivery of 250,000 doses for an amount of 36 million dollars.
At SRD again, equipment manufacturers are recovering after their sharp drop the day before. Faurecia gain 4.4%, Valeo 3% and Plastic Omnium 2.9%.