The general rise of the financial planet this Friday, including an increase of almost 4% in the index of Nasdaq Composite technology stocks on Wall Street, allowed Bedroom 40 avoid the fourth week of decline in a row. The Paris index at the end of a very stormy week shows a weekly increase of 1.67%. Today, it rose 2.52% to 6344.32 points with an extraordinary trading volume of 3.6 billion euros.
Chip manufacturer STMicroelectronics (+ 6%) led the growth after increasing by 4% yesterday, after the Franco-Italian group presented its new medium-term goals. Yesterday, during a meeting with investors, STMicroelectronics said it seeks stable growth in its revenues, which will be accompanied by increased profitability. His ambition is to achieve a turnover of more than 20 billion dollars by 2025-2027 with a gross margin of about 50%.
In general, the semiconductor sector has used information from Bloomberg, according to which South Korean Samsung is currently negotiating with its customers to increase the selling price of semiconductors, which it produces under contract.
Stoxx’s European Technology Stock Index rose almost 3% today. Globally, the technology sector – along with all the most risky assets (such as high yields or cryptocurrencies) – is the one that has suffered the most from sell-offs caused by tightening monetary conditions in the United States.
Concerns about inflation have turned into fears of economic growth, say Barclays strategists. The stock market is increasingly worried that in the United States, where there is a spiral of prices / wages, the US Federal Reserve (Fed) will not be able to win the fight against inflation without causing a recession. Last night, Fed Chairman Jerome Powell acknowledged that the possibility of a soft landing depends on factors beyond the control of central banks, and that returning inflation to the 2% target will be difficult.
No surrender yet
“Equities experiencing capital outflows as treasury inflows accelerate”, says Emmanuel Kau’s team at Barclays, but there has been no panic in the stock markets. The same story in Bank of America Securities, where we see a “start of release” – Investors began to sell “Promotions they like”like Apple or Tesla – but without real surrender.
Thus, the rebound of the day will be associated with a short-term rally in the “bear market”. As major stock indexes around the world have already fallen by more than 20% from their record at the beginning of the year or close to it, some investors are beginning to change position.
On Wall Street, in this environment of mistrust, where volatility is just a reflection of the nervousness of investors who have no benchmarks, the S&P 500 is on track to level for the sixth week in a row, less than ten. years – despite the fact that today the index has risen by more than 2%. Contrary to this trend, Twitter fell by almost 10% as Elon Musk announced that his proposed $ 44 billion takeover had been suspended.
“Investors are faced with a difficult choice” explains Laurent Denise, investment manager at Oddo BHF AM. What it is? Reduce the level of risk again by supporting the overall economic downturn in a market that has already adjusted or outperformed equities, favoring the results of companies that are currently reliable but potentially at risk. He decides the debate: for Europe, “Current revenue estimates for 2022 are overly optimistic given China’s economic slowdown, global economic downturn and energy supply shock. »