The Paris Bourse ended down 0.56% on Thursday, painfully digesting the sharp slowdown in activity in France and the euro zone in June, even if the good performance of luxury allowed it to limit losses.
The star CAC 40 index lost 33.30 points to 5,883.33 points, the day after a drop of 0.81%. The Parisian place, however, does a little better than its counterparts London (-0.97%) and especially Frankfurt (-1.76%).
After yesterday’s falls, European markets already looked vulnerable on growing concerns about a global slowdown. Those fears were heightened after the latest PMIs summarized CMC Markets analyst Michael Hewson.
Growth in activity in the private sector in France markedly stalled in June, falling back to its pace of January in the midst of the Omicron wave, according to a provisional index published Thursday by S&P Global.
And in the euro zone, the slowdown in growth recorded was the most severe since November 2008, i.e. at the height of the global financial crisis, with the exception of those observed during periods of sanitary confinement, underlined Chris Williamson, economist chief for S&P Global, in a press release.
Despite the sharp drop in the CAC 40 since the start of the year (-17.75%), the market remains quite complacent, even optimistic about the fact that corporate results will hold up while the dynamism of consumers, which has supported the trend since the beginning of the year, is showing signs of weakness, also supports Raphal Thuin, of Tikehau Capital.
The fear of a recession was also observed on the bond market, where the interest rate for the French 10-year loan fell by 21 basis points, to 1.96%. The rate was still over 2.32% on Tuesday.
Luxury as mud
This respite in interest rates was able to benefit in particular so-called growth stocks, which need low rates to finance their growth and enhance their long-term profits.
Thus, in luxury, a heavyweight on the Parisian coast, LVMH took 2.59% 566 euros, Herms 2.07% 1,035 euros, Kering 0.43% 490 euros.
Technology also appeared in green, such as Dassault Systmes (+2.50% 35.11euros), or Teleperformance (+0.50% 282.70euros).
Valneva’s vaccine authorized in the EU
Retirement : save by paying less tax. 11 contracts compared
The European Medicines Agency (EMA) on Thursday approved the coronavirus vaccine from Franco-Austrian biotech Valneva, which becomes the sixth anti-Covid 19 vaccine recommended for adults in the 27 countries of the European Union.
The action jumped 19.62% to 14.24 euros, continuing the rise of the title this week (+79.33%). However, the share is still accumulating a deficit of 41.90% compared to its level at the start of the year.
Other health stocks have progressed, such as Eurofins Scientific (+4.20% 76.48 euros), while the cases of Covid-19 recorded are rising rapidly in France. BioMerieux took 2.53% 89.06 euros and Sanofi 0.22% 95.75 euros.
The banks are disillusioned
Conversely, the sharp fall in interest rates and the risks to economic activity penalized banks, such as Socit Gnrale (-5.51% to 22.30 euros), BNP Paribas (-4.69% to 46, 74 euros), and Crdit Agricole (-3.97% 8.88 euros).
Other so-called cyclical companies because they are linked to economic cycles have fallen back, such as Unibail-Rodamco-Westfield (-4.54% 50.68 euros), Michelin (-4.43% 25.81 euros) or Publicis (-4, 13% 45 euros).