The Paris Stock Exchange regains strength after a difficult week – 05/26/2023 at 18:25
The Paris Stock Exchange gained 1.24% on Friday, its best session since the beginning of the month, a rebound that does not compensate for the heavy losses of the week, marked by profit taking on luxury goods and worries about the American debt. .
The star CAC 40 index gained 89.91 points to 7,319.18 points, the best performance since May 5. It thus breaks a series of four declines, which brought the Parisian rating to its lowest level since the end of March.
But overall the CAC 40 is experiencing its worst week since mid-March (-2.31%).
The Parisian rating hovered around the balance during the first part of the session, before accelerating from midday, then with the opening of the American markets.
It’s “a technical rebound,” said Lionel Melka, partner at Swann Capital. “We breathe, saying that on the story of the debt ceiling, we will find a solution,” he said.
Discussions on the US debt ceiling seem to be moving in the right direction between the White House and congressional leaders, although an approval vote afterwards will be difficult to obtain from elected Republicans.
The discussions between the White House and the Republican opposition are “productive”, assured Thursday the spokesperson for the executive, Karine Jean-Pierre, removing the prospect of a default of payment from the United States.
“The market hates uncertainty. Everyone thinks it would be silly to get into a default situation, but there is always the risk that it will go wrong,” says Mr. Melka to explain the tension that has driven this week all markets.
In addition, the report on inflation in the United States, the most awaited indicator of this week, did not necessarily go in the direction of investors because “it shows that inflation persists”, retains Mr. Melka.
The PCE index, the favorite of the US central bank, rose 4.4% year on year in April, against 4.2% the previous month. More worryingly, the underlying index, which excludes sectors with volatile prices such as food and energy, accelerated to 4.7%.
Spending by American households increased sharply (+0.8% in April), which is partly a reflection of the rise in prices, while their incomes also rose (+0.4%).
But this resilience of the economy also gives the Fed more leeway to raise its key rates even further.
Investors now give a probability of more than 35% to this scenario which seemed excluded to them at the beginning of the month.
As a result, interest rates in France rose again: the rate for the 10-year loan reached 3.11%.
Casino debt on the table
On the resumption of its quotation after three days of suspension, the action of the distributor Casino fell by 6.43% to 6.33 euros, consequence of the announcement of the opening of a conciliation procedure in order to renegotiate its important indebtedness. At the start of the session, Casino had lost more than 10%.
The action of its parent company Rallye fell another 10.00% to 0.90 euro. Since the start of the year, the Casino stock has lost more than a third of its value and that of Rallye around 66%.
Electrical AG at TotalEnergies
The shareholders of TotalEnergies (+ 1.38% to 55.76 euros) largely validated the group’s climate strategy on Friday, during a general meeting held under pressure from demonstrators, massed outside, but also from the government. , who call on it to turn away from fossil fuels more quickly.
Badly treated in the middle of the week, luxury stocks rose sharply on Friday: LVMH took 2.44% to 843.50 euros, the second increase in the CAC 40. Hermès took 2.32% to 1,959.20 euros, Kering 1, 43% to 517.70 euros.