The Paris Stock Exchange rebounded 2.77% on Friday, largely driven by the luxury sector which benefited from speculation about a relaxation of China’s zero-Covid policy.
The flagship CAC 40 index gained 173.16 points to 6,416.44 points, its highest closing level since August, after losing 0.54% the day before, weighed down by announcements from the American Central Bank (Fed). Over the week, the Parisian rating took 2.29%.
Investors are speculating on a possible relaxation of Chinese anti-Covid measures, which has not yet been confirmed by Beijing. A meeting of Chinese health authorities is to be held on Saturday.
“It seems that China could end a restrictive policy concerning its airlines” and “that a messenger RNA vaccine is being approved in China for foreign residents”, details Raphaël Thuin, head of strategies of Tikehau Capital’s capital markets.
“China is a subject of concern for the markets because we know that its restrictive policy slows down the growth” of the country, he recalls.
Luxury, of which China is a very important market, particularly benefited from these rumors and enabled the CAC 40 index to reach its highest closing level since August 19.
China is the last major economy to apply a rigorous anti-Covid policy, which involves repeated confinements, testing of the population several times a week and long quarantines.
Investors also paid attention to US job market data released on Friday. The unemployment rate rose to 3.7% in October while 261,000 job creations were recorded, a figure higher than analysts’ expectations.
These figures show the first signs of “cooling of the labor market”, according to Mr. Thuin, but they are not yet sufficient to convince the American central bank (Fed) to change its monetary policy, which is currently very restrictive.
On Wednesday, investors unsurprisingly welcomed the Fed’s further 75 basis point interest rate hike but their hopes of a lull were dashed as the Fed announced that interest rates would be kept at a low level. higher and for a longer period than expected.
Luxury boosted by China
In Paris, as in other European stock markets, shares in the luxury sector jumped on Friday.
Recording the largest increase in the CAC 40, Kering took 7.07% to 503.40 euros, also supported by an article in the Wall Street Journal reporting “advanced discussions” concerning the acquisition of the Tom Ford brand.
L’Oréal gained 6.78% to 321.40 euros, LVMH 5.75% to 666.20 euros and Hermès 3.71% to 1,357 euros.
Mining on a good vein
Like the luxury sector, mining stocks have benefited from speculation concerning China.
ArcelorMittal took 6.48% to 23.51 euros, Eramet 10.01% to 75.80 euros and Aperam 9.02% to 28.29 euros.
Societe Generale hailed
Société Générale gained 2.55% to 24.10 euros, after having published before the opening a turnover slightly up (+ 2.3%) over one year in the third quarter, but a profit down by 6.4%, weighted by the remuneration of regulated savings accounts and the provisions constituted in the event of unpaid bills.
JC Decaux is a hit
The advertising display giant recorded sales growth of more than 14% in the third quarter, above its expectations, but remains affected by travel restrictions in China. The group’s share price rose 14.34% to 14.75 euros.
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