Cac 40 slowed due to tensions between Beijing and Washington over Taiwan, Market News

The Paris stock exchange fell and Wall Street is expected to follow at the open amid rising tensions between Beijing and Washington over a possible visit by Nancy Pelosi to Taiwan. Coupled with heightened concerns about global growth, the episode is undermining a sustained recovery that saw major financial centers post their best July performance since 2020. August and September turned out to be the worst two months of the year for the S&P 500 on record. the last three decades.

Around 2:30 p.m Bedroom 40 lost 0.43% to 6,409.15 points with a business volume of 900 million euros. Contracts future on American indices, the yield is from 0.6% to 0.8%. Caterpillar fell 3.9% in premarket New York, weighed down by lower-than-expected quarterly revenue, with the construction and mining equipment giant citing slowing sales in China in particular. And vice versa, Uber jumped by more than 13%. If the quarterly profit was disappointing, the turnover turned out to be better than expected. Additionally, Specialist VTC generated its first positive cash flow.

Beijing has warned of the consequences of a possible visit by the speaker of the US House of Representatives to Taiwan, which China considers an integral part of its territory. Nancy Pelosi, who is on a tour of Asia, is expected to arrive on the island this Tuesday at 10:30 p.m. local time, Liberty Times reported. On that occasion, she could meet President Tsai Ing-wen in a meeting of a level not matched by an American parliamentarian on the island in 25 years.

Technologies and luxury under pressure

Several Chinese fighter jets flew over the area near the Taiwan Strait demarcation line this morning, an official familiar with the operations said, quoted by the agency. Financial Times. ” All eyes will be on the Chinese military to see how they will react if Pelosi does go to Taiwan Edward Moya, market analyst at Oanda, wrote in a note early this morning.

Semiconductor manufacturers are among the victims of this tension, as most chip production comes from Asia. The European Stoxx 600 technology index fell 2.1%.

Sensitive to the political and economic situation in China, the luxury sector is also falling. LVMH and Kering lose 1.9% and Hermes 0.9%.

In contrast, values ​​related to defense are circled. Thales thus occupies 1.7% and Dassault Aviation 1.4%.

On the sovereign debt side, the yield on the US 10-year bond hit a four-month low of 2.4982% this morning before returning to around 2.55% (bond prices rise when yields fall) thanks to a “flight to quality”. The bond market was buoyed by hopes that a slowdown in activity in the United States could encourage the Fed to be less hawkish while playing its role as a safe-haven investment house ahead of a possible visit by Nancy Pelosi to Taiwan.

Sanofi is backed by Bank of America

In SRD, Vilmorin increased by 5.3%. The seeds company posted a 6.2% rise in sales for the 2021-2022 financial year and raised its full-year guidance after lowering them in May.

The greatest increase in Cac 40, Sanofi grows by 2.5%. BofA raised its estimates, including its EPS forecast, after its second-quarter results. The note’s author reiterated his buy recommendation, noting that the group’s growth and pipeline improvements are “undervalued.”

ADP increased by 1.8%. HSBC has raised its recommendation on the airport operator’s name from “underweight” to “hold”. Conversely, the rating of Societe Generale decreased Nexans from “buy” to “hold”. The share of the cable producer lost 1.4%.

Exclusive networks occupies 6.4%. The provider of cyber security services and technologies for companies has crossed the billion euro mark for the first time in its history.