The control room of Euronext, the company that manages the Paris Stock Exchange (AFP/Archives/ERIC PIERMONT)
The Paris Stock Exchange was down 0.67% in the first trade on Wednesday, still uncomfortable with the risk of a banking shock in the United States, and after the upward revision of inflation in France.
The star CAC 40 index fell 47.84 points to 7,093.73 points around 9:35 a.m. The day before, it resumed 1.86%, after five sessions of consecutive declines and more than 4% lost between Friday and Monday.
“After three sessions of massive turbulence, the last 24 hours have seen market volatility begin to stabilize for the first time since the start of the crisis” which began with the bankruptcy of the American bank Sillicon Valley Bank, observe analysts of the Deutsche Bank.
The fears of cascading bankruptcies after the collapse of SVB have not materialized for the moment, and certain American regional banking establishments even resumed some colors on the stock market on Tuesday.
But the trend remains fragile. Nobel laureate in economics Joseph Stiglitz welcomed in an interview with AFP the reaction of the American authorities but does not exclude other failures. For him, “the stability of the financial system must be rethought, taking into account new technologies”.
The crisis has caused a change in investors’ expectations about the next monetary decisions of central banks. Faced with the situation, the US Federal Reserve will, according to them, be more concerned about the economic risks associated with the sharp rise in rates over the past year, which will encourage it to lower its rate hike rate.
However, inflation remains high in the United States, at 6% over one year in February, according to the CPI consumer price indicator published on Tuesday. On Wednesday, it is the turn of producer prices as well as retail sales.
On the bond market, the rate of French borrowings started to rise again, although much lower than the rates of the past week. It was close to 3% for the 10-year maturity.
In France, price increases reached 6.3% in February over one year, driven by soaring food prices, which have become its primary driver ahead of energy, according to a final estimate revised slightly higher on Wednesday by the Insee. The first estimate was 6.2%.
“Central bankers’ recovery of inflation requires tougher financial conditions, although central bankers want the tightening to be orderly and controlled. This implies downward pressure on the price of most assets “beyond a technical rebound, write analysts at Banque Postale AM.
Banks not out of business
After their rebound on Tuesday, the banks started falling again: Societe Generale yielded 2.02% to 23.99 euros, BNP Paribas 1.36% to 57.11 euros, Crédit Agricole 1.34% to 10.64 euros.
Buyback of shares for Bolloré
The Bolloré group received a net profit of 3.4 billion euros in 2022, thanks in particular to the sale of its logistics activities in Africa, after an already exceptional year 2021, according to its results published on Tuesday. He announced a “planned simplified takeover bid by Bolloré SE for its own shares relating to 9.78% of the capital at a price of 5.75 euros”. The action jumped 8.19% to 5.55 euros.
Vivendi, whose strong man is Vincent Bolloré, yielded 3.90% to 9.06 euros, the worst drop in the CAC 40.
© 2023 AFP
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