The Paris Stock Exchange was burdened by a new, very ambiguous indicator of American prices, Market news

The Paris Stock Exchange remained in the red this Thursday, now falling significantly by almost 3%. At the beginning of the day Cac 40 lost exactly 2.7% to 6105.52 points, giving up growth the day before. We are talking about the reversal of Wall Street at the end of the session on Wednesday and the prospect of further decline in the first trade today. Contracts future on major indexes lost 0.6% for the Dow Jones to 1.6% for the Nasdaq Composite.

In New York, as elsewhere, the eyes were fixed on the second statistics of the week on the evolution of prices in the United States. With the same observations as the day before, and their counterparts on consumption. They calmed down a bit after their peak in March, not calming down completely in a quick slowdown. Year on year, consumer prices rose by 11%, which is less than the increase of 11.2% in the previous month, but more than the consensus target of 10.7%. They increased by 6.9% in the “basic” data, ie excluding volatile elements such as energy and food, compared to the expected 6.6%. Compared to March, as expected, the increase is 0.5% in published data and 0.6% in the “main”.

Yesterday, consumer prices rejected 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 giving up from 4.6% to 6%. Another company that is considered expensive on the stock market and sensitive to rising interest rates, Dassault Systems loses 5.1%.

Veolia environment, but ahead of its plan in the first quarter after the merger with Suez, lost 7.6%. Some analysts believe that the forecast is somewhat conservative.

Bug (-1.2%) withstands 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 published the strongest of the rare increase Cac 40 (+ 2.5%).