The 2.5% surge on the Paris Stock Exchange on Wednesday was very ephemeral. The Cac 40 fell sharply again on Thursday, falling 2.47% in the middle of the day, to 6,115.50 points, after a disappointing session in New York, where the Dow Jones lost 1.02% and the Nasdaq Composite more than 3%, and the first exchanges are expected in the red according to the contracts future.
However, be careful, the trend will again depend on the figures that will be presented at 14:30 and which still relate to the evolution of prices across the Atlantic. After consumer prices on Wednesday, it will be producer prices for April. It is also expected to decrease slightly, which is recognized as 10.7% for the year, but less than the increase to 11.2% in March. ” The PPI index shows signs of leveling over several months, slightly above 10% for the year. Recent price stabilization may allow for a slight setback “, Oddo BHF said earlier this week. During the month, it is expected to grow by 0.5% against 1.4% in March and by 0.6% in the “main” (excluding food and energy) against 1% in March.
Consumer prices presented yesterday confused investors. At 8.3%, inflation for the year was expected to be below 8.5% in March, a 40-year peak, but above 8.1% expected by consensus. Enough to prove both optimists – but perhaps even more pessimistic – given the evolution of Wall Street last night – about the evolution of prices in the country …
“Crisis of the cost of living”
For Allianz’s chief economic adviser, Mohamed El-Erian, the 6.2% core inflation in April means that there are many factors that are currently influencing price formation. ” It is only a matter of time before we talk about the crisis of the cost of living. It is not just about the war in Ukraine, but about the process of large-scale inflation, in the management of which the Fed lagged behind.. »The delay, which he may have to compensate for by a more aggressive rate hike than by a mere 50 basis points increase in his Fed funds at future FOMC meetings.
On the other hand, Veronica Riches-Flores, an economist at Riches-Flores Research, “ this report undoubtedly increases the likelihood that the peak of inflation in the United States is behind us. (…) She notes 18.5% increase in air ticket prices in one month is certainly the largest increase in the index, without which the monthly growth of the base rate would be 0.4%, instead of 0.6%, which markets did not expect a possible easing of interest rate tensions ( …) Rising prices for leisure goods or services, for example, about twice less than two or three months ago. Clothing prices fell by 0.8%. Rental increases, which are particularly feared after being seen in the real estate market, are not accelerating in a showy way “.
STMicro as a “relic” of the session
In terms of values, the luxury sector, which accounts for more than 20% of Cac 40’s weighting, influences the trend Caring, Hermes and LVMH fell by 4.5% to 5.3%. Another company that is considered expensive on the stock market and sensitive to rising interest rates, Dassault Systems loses 5.1%.
Veolia environmentbut ahead of its plan in the first quarter after merging with Suez, lost 4.2%.
Bug (-1%) resists better. The construction and telecommunications group released $ 8.2 billion in late March, up nearly 6 percent from operating profit of $ 77 million, stable for the year but lower than analysts had feared. Annual forecasts are maintained.
As part of Investor’s Day STMicroelectronics pointed out that it aims at a turnover of more than $ 20 billion for 2025-2027 with a gross margin of about 50%. The report received 5 out of 5 in the stock market, the title of Franco-Italian semiconductor manufacturer shows the strongest of the rare increase in Cac 40 (+ 1.9%).