Cac 40 paralyzed by fear of recession, Market news

The word came out: “recession”. The term, which had been returning to economists’ vocabulary for several weeks, is now in the mouths of central bankers. On Wednesday, then again Thursday, US Federal Reserve Chairman Jerome Powell, who listened to Congress, acknowledged that the gradual rise in interest rates Fed funds, designed to counter inflation is likely to cause a recession. From a technical point of view, this is characterized by falling GDP for two consecutive quarters. Now the worst-case scenario is expected, as the Fed has so far tried to stop and spare the markets by talking about a soft landing for the economy. ” After Deutsche Bank, Nomura and Goldman Sachs, it is now Citigroup’s turn to predict the recession “, Says John Plassar of Mirabaud Securities. For its part, Pimco, one of the world’s major bond investors, assesses the risk of a recession. erect over the next two years, and recalls the ” financial accidents “.

Recent activity indicators confirm the slowdown scenario. In the euro area, the previous consolidated PMI S&P Global index (synthesis between industry and services) fell to its lowest level in 16 months to 51.9 points in June from 54.8 in May. He passes the shock of the cost of living and the deterioration of business and consumer confidence says Chris Williamson, chief economist at S&P Global. Ricardo Amaro, senior economist at Oxford Economics, ” The results show a significant break from recent PMI figures, which have shown some initial resilience in the face of numerous headwinds that overshadow the eurozone’s economic outlook.he points out. The breakdown of the numbers indicates a general slowdown. The manufacturing sector continues to show particular weakness […tandis que] the expansion of services lost momentum in June. In the United States, private sector growth slowed in June, and the new order index even declined for the first time in nearly two years.

Stocks and commodities under pressure

As a result of these fears, European stock markets continued to decline. In Paris, Bedroom 40 fluctuated before ending in the twelfth fall since the beginning of the month, falling 0.56% to 5883.33 points with a transaction volume of 3.5 billion euros. On the other side of the Atlantic, the main indices are resisting due to technological reserves. Yet, S & P500, which serves as a benchmark for American managers, is about to end the worst first half of Richard Nixon’s presidency, according to data collected by Bloomberg. ” All key indicators of the US economy are deteriorating. Household sentiment also reached record lows in response to a 40-year high in inflation. As if that wasn’t enough, the S&P 500 and Nasdaq are in a bear market. [marché baissier]. Since when has the Fed raised rates so much in such a degraded environment? “, Worries Troy Ludtka, an economist at Natixis.

In the wave of shares, raw material prices are falling, as well as copper, which fell to its lowest level in 16 months – $ 8,564.5 per ton. Oil prices are also affected. in Brent will decrease by 7% in five days. The decline was underscored by portfolio refinement operations conducted by many US and European funds as the year ended.

Valneva takes off for recovery

In terms of values, the leader of bioanalysis Eurofins Scientific rose 4.2%, according to Deutsche Bank, changed from “sell” to “save”. The broker maintains a target price of 80 euros. In another sector, he initiated the coverage of a video game publisher Ubisoft (+ 1.81%) with “buy” advice and a target price of 60 euros.

Athos rose by 6.18%. According to BFM Business, Thales will have the support of the Ministry of Economy and Finance and the Directorate General of Armaments to try to take over the digital cybersecurity services group. Finally, the title citation has been suspended since its opening Valneva recovered at 16:30 with a surge of 19.62%. The French-Austrian biotechnology company received a positive opinion from the Committee for Medicinal Products for Human Use of the European Medicines Agency (EMA) on the marketing authorization of its candidate vaccine against Covid-19, VLA2001, for use in primary adult vaccination (18 to 50 years) .