The control room of Euronext, the company that manages the Paris Stock Exchange (AFP/Archives/ERIC PIERMONT)
The Paris Stock Exchange ended Wednesday down for the fifth consecutive session, by 1.37%, concluding a month of August where prices melted due to the determination of central banks to fight against inflation.
The star CAC 40 index fell 85.12 points to 6,125.10 points. Over the month, it lost 5.02%, erasing part of July’s gains (+8.87%). Since January 1, the Parisian rating has lost 14.37%.
After a new attempt to rebound at the opening, the Parisian place quickly tipped into the red to fall to its lowest since July 18.
“The economic scenario has deteriorated in recent weeks. Inflation is not slowing down in Europe while the economic situation is deteriorating, in particular with fears over Europe’s gas supply”, explains Charlotte de Montpellier, economist at ING.
If inflation in France slowed for the first time in more than a year in August, to 6.5% over one year according to the European harmonized index, that of the euro zone accelerated more than expected to reach 9, 1% YoY. In 10 countries, such as Spain, inflation is above 10% per year.
One week before the meeting of the European Central Bank (ECB), the Frankfurt institution is therefore under pressure and many analysts believe that it will in turn want to strike hard by significantly raising its key rates, its main weapon to influence on rising prices.
But this policy still risks weakening the European economy, while a recession seems more and more inevitable for the experts.
“The recession goes hand in hand with a drop in corporate profits, which affects their stock market price,” explains Ms. de Montpellier.
Investors found little comfort in gas prices, which continued to decline on Wednesday after their surge in previous weeks.
The context of rising interest rates also weighed on government debt. The interest rate for the French loan rose to 2.14%, against 1.37% at the end of July.
Financial stocks hold up
This context of rising interest rates enabled financial stocks to hold up better over the month. Among the only six stocks in the green in August on the CAC 40, are Crédit Agricole (+2.35% to 9.19 euros), BNP Paribas (+1.05% to 46.49 euros), Société Générale ( +1.12% to 22.08 euros). It is another financial value, the insurer Axa which achieved the best monthly performance of the flagship index (+4.79% to 23.53 euros).
BioMérieux in small form
The bioMérieux laboratory published mixed results on Wednesday in the first half, but it revised its objectives slightly upwards for 2022 after a dynamic second quarter. Its action fell 5.61% to 91.26 euros.
TotalEnergies falls again with oil
Like the entire oil sector in Europe, TotalEnergies suffered in France from the further sharp decline in the price of Brent from the North Sea, around 2.50% shortly after the Paris close. The French group fell 3.32% to 50.69 euros, the worst performance of the CAC 40.
© 2022 AFP
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