All Hazards Week is open to Cac 40 companies, with around thirty results as of June 30 to be released by Friday. Publications that come out after the beginning of a year marked by an inexorable jump in prices, which puts the profitability of companies to the test. In this context, companies should raise prices as much as possible to limit the impact of inflation. The tightening of monetary policy resulting from this phenomenon, especially in the Eurozone and the United States, raises fears of an economic recession that will inevitably affect business growth.
Michelin, Dassault Systèmes and LVMH are on the grill before Alphabet and Microsoft
The first posts will start on Tuesday, first of all Michelin. The automotive landscape is currently weakened” increasing signals of recession, geopolitical instability and resurgence of Covid-19 cases explained Barclays analysts in a note in early July. The global tire leader was able to maintain growth in the first quarter by raising prices. In the quarter that just ended, the Bloomberg consensus calls for a 17.7% year-on-year increase in turnover to 6.7 billion euros. If the estimates are confirmed, the sales volume for the half year will amount to slightly more than 12 billion euros.
In the luxury sector, tourist buying spree in Europe could boost half-yearly group accounts LVMH, despite the deteriorating environmental situation in China. The market will also scrutinize the half-yearly report Dassault Systems. After a first quarter that beat expectations, the publisher of automated design and manufacturing software had the luxury of raising its annual operating margin target to more than 33%. The momentum should continue in the second quarter, with half-year sales estimated at €2.65 billion (+16% year-on-year). The table below summarizes the company’s other major publications.
Internationally, after a below-expected first quarter, parent company Google, Alphabet Inc. will release second-quarter results after the close on Wall Street. The publication comes after a shock at Snap that caused Meta Platforms, the owner of Facebook, Alphabet and other companies that rely on online advertising revenue, to lose more than $80 billion in combined market capitalization last Thursday. Alphabet’s turnover in April-June is expected to be $58 billion (Bloomberg consensus), which is 6% less than a year ago. Digital giant Microsoft, whose fiscal year is delayed, will publish its fourth quarter reports also after the close. Three Dow Jones companies 3M, Coca Colaand Visa will release its second quarter results as it will UBS and UPS.
The IMF may downgrade its forecasts again
On the macroeconomic front, investors will be watching for new forecasts from the International Monetary Fund at 3:00 p.m., while further downgrades in growth prospects should be expected. The forecast was already cut from 4.4% to 3.6% in April last year and should fall again in July to between 2.5% and 3%.
In the United States, inflation and rising interest rates are hurting consumer confidence. Indicator Conference Council should fall again from 98.7 in June to 96.9 in July. This deteriorating economic environment should also lead to “ housing market undergoing a sharp correctionOddo BHF analysts explain. Prices are reacting late (the latest published data refer to the period from March to May), but given the strengthening of borrowing conditions, they will definitely calm down “. Index FHFA, which measures the change in house prices on the other side of the Atlantic, is expected to rise 1.5% in one month, in May, compared with 1.6% in April. Another sign of a slowdown sale of new houses should rise from 696,000 to 661,000 in the May-June period on an annualized basis.
On the Old Continent, the ministers of the European Union will meet on the subject of the Russian gas crisis.