The Paris Stock Exchange fell 0.64% in early trading on Wednesday, after jumping more than 6% in the previous three sessions, as investors reassessed their expectations of central bank policies.
The star CAC 40 index fell 38.64 points to 6,001.05 points around 9:25 a.m. The day before, it had taken off from 4.24%, its largest increase in one session since March.
To explain the return to grace of equities after a catastrophic month of September, analysts at the Banque Postale argue that “central banks are aggressive in their monetary tightening but not totally oblivious to the risks of financial instability and a marked recession”, and could therefore slow down a little in the coming months, despite their latest statements.
In addition, “market valuations are already factoring in a lot of bad news” according to these analysts, the Paris Stock Exchange having hit its lowest since February 2021 on Thursday.
Temporary elements, such as a technical rebound “after the runaway price declines at the end of September”, however, lead these analysts to “caution” on its sudden movements: they do not believe in a “sustainable short-term” movement.
The Paris Stock Exchange had in particular experienced a euphoric start to the summer already, with the hope that the central banks would be more lenient on economic activity, before plunging again from mid-August.
In terms of indicators, industrial production in France rebounded in August by 2.4% over one month after falling 1.6% in July, INSEE reported on Wednesday.
French gas reserves are full in anticipation of winter, the Energy Regulatory Commission (CRE) also announced on Wednesday, calling all the same for a “massive collective effort aimed at reducing our energy consumption”. The price of European natural gas has fallen sharply since its peak in August, and was around 161 euros per megawatt hour shortly before 9:15 a.m. on the benchmark market, the Dutch TTF.
Investors are still waiting for the ADP survey on employment in the United States on Wednesday, before the official monthly report on Friday, but also for activity indicators in services in Europe and the United States.
Business values suffer
The companies most sensitive to economic activity, such as banks (Crédit Agricole -2.16% to 8.63 euros), the shopping center giant Unibail-Rodamco-Westfield (-3.43% to 43.32 euros ), or the automobile (Michelin -3.27% to 23.25 euros), suffered profit taking after their rise in recent days.
Tech bucks the trend
Technology stocks, the most sensitive to interest rates which have fallen sharply in recent days, were better oriented on the Paris market: Teleperformance rose 0.04% to 269.60 euros, STMicroelectronics 0.20% to 34, 55 euros.
Luxury (LVMH -0.08% to 646.30 euros), or health (Sanofi +0.34% to 80.28 euros), with the same links with financing conditions, were also spared.
Bouygues finalizes the acquisition of Equans
The historic takeover by Bouygues from Engie of its large multi-technical services entity Equans was finalized on Tuesday, the two groups announced, allowing the conglomerate to develop strongly in the buoyant energy transition market.
On the stock market, Bouygues fell 1.34% to 27.30 euros, slightly less than the other construction group Vinci (-1.71% to 83.80 euros). Engie fell 0.73% to 12.22 euros.
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