The Paris Stock Exchange was down sharply on Monday morning, like the European stock markets, weighed down by fears of an imminent invasion of Ukraine by Russia.
Around 9:55 a.m., the CAC 40 index fell by 3.37%, or 236.00 points, 6,775.60 points.
On Friday, the Paris market had already ended on a sharp decline of 1.27%, concerned about the evolution of inflation which raises fears of a stronger tightening than anticipated in the monetary policies of central banks.
The Parisian market wavered, as did the other European indices. Frankfurt lost 3.47% and London 2.11%. A little earlier, the Tokyo Stock Exchange ended down 2.23%.
Added to concerns about inflation were fears of a possible imminent invasion of Ukraine by Russia, which had stiffened Wall Street at the close on Friday. The Dow Jones lost 1.43%, the Nasdaq 2.78% and the broader S&P 500 index 1.90%.
The most immediate theme for the market is the geopolitical question in the East. It is clearly an accelerator this morning, commented Alexandre Baradez, analyst at IG France.
There were telephone exchanges this weekend between European, Russian and American officials, but this has not yet given rise to visible declarations of relaxation. This is really the subject that worries the market, he continued.
Tensions are at their height, with 130,000 Russian soldiers massed on the Ukrainian border carrying out maneuvers in all directions. German Chancellor Olaf Scholz is expected Monday in Kiev to continue diplomatic efforts to defuse the threat of Russian invasion of Ukraine.
Geopolitical tensions are pushing bond yields up and putting downward pressure on equities. They have also ignited oil prices, at their highest for seven years, particularly sensitive to a statement by US Secretary of State Anthony Blinken estimating Friday that Russia could invade Ukraine at any time.
Commodity prices are tending, an inflationary element, at the very moment when central banks are already toughening their stance in the face of rising prices, which is doubly weighing on investors, underlines Mr. Baradez.
On the macroeconomic side, investors will keep an eye on the intervention of the President of the European Central Bank Christine Lagarde on Monday, and on the economic bulletin of the European institution published on Thursday. The Fed’s monetary policy report will be published on Wednesday evening in the United States.
All in the red
All of the CAC 40 values were in the red, Socit Generale (-6.62% to 33.59 euros) and BNP Paribas (-5.44% to 61.37 euros) recording the heaviest falls.
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Banking and cyclical stocks were the most penalized in today’s scenario, as investors worry about the economic outlook.
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Carried away in the fall in the market, Thales resisted a little better (-1.78% to 82.64 euros). TotalEnergies (-1.97% to 51.22 euros) also limited its decline within the CAC 40, while a barrel of oil is its highest price for seven years.
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