The Paris Stock Exchange fell slightly by 0.18% on Wednesday, as Powell’s reassuring remarks failed to offset the drop in the prices of TotalEnergies and Société Générale after the publication of their results.
The star CAC 40 index lost 12.52 points to 7,119.83 points. The Parisian coast had stagnated (-0.07%) the day before while awaiting with apprehension an intervention from Mr. Powell.
US central bank chief Jerome Powell said on Tuesday that further rate hikes would likely be needed if economic data continued to be stronger than expected in the United States.
The stock market does not integrate this conclusion (of the need for new rate hikes) and hears that American growth is not at risk, comments Cline Weill-Alliel, manager of Uzs Gestion.
Jerome Powell also reaffirmed that inflation was falling, which, in the eyes of investors, may prefigure a pause in rate hikes.
These remarks calmed some fears raised by stronger than expected US labor market figures, published on Friday, even if it remains difficult for investors to have a firm position on the future evolution of monetary policy. American.
There are two opposing visions and one prevails over the other, the market wants to be optimistic, believes Cline Weill-Alliel, manager of Uzs Gestion.
On the bond market, yields on short-term European government bonds, the most sensitive to investors’ expectations of interest rates and inflation, rose after the European Central Bank (ECB) decided the day before to reduce May 1 the rate of return that banks in the euro zone apply to government deposits and other public structures. The measure is intended to gradually reduce these deposits and to inject this liquidity into the market.
TotalEnergies runs but the action stalls
TotalEnergies posted the largest profit in its history, 20.5 billion dollars (19 billion euros) in 2022, thanks to soaring gas and oil prices in the wake of the war in Ukraine.
The action suffered a sharp drop of 1.91% to 56.44 euros, contrasting with the strong increases recorded in recent days after the results exceeded expectations of other oil majors. TotalEnergies’ profits came out just in line with expectations.
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Societe Generale is sulking
Socit Generale fell by 5.03% to 26.62 euros after publication of an increase in turnover in 2022, but a net profit almost divided by three, 2.02 billion euros, due to the negative impact of the sale of its Russian subsidiary Rosbank, but which nevertheless exceeded analysts’ expectations.
The only downside is distribution, slightly below fourth quarter expectations, Jefferies said in a note. Other analysts anticipate a drop in income in 2023 and preferred to invest in BNP Paribas (+ 2.42% 63.85 euros), which plans to buy back 5 billion euros of its shares in 2023.
Results well received for Amundi
The European leader in asset management Amundi (+2.61% 62.85 euros) ended a positive financial year 2022 in terms of capital raised in its funds, even if its net profit fell by 20% compared to the record of 2021.