(News Bulletin 247) – While Wall Street ended Friday close to equilibrium, after a monthly federal employment report which did not make waves, the CAC 40 should resume the downward path (its main direction since the beginning of the year), below the symbolic threshold of 6,000 points. He gleaned 0.44% to 6,033 points on Friday.
Report whose content is rather reassuring in the sense that the Fed’s dread of a runaway price/wage spiral has been postponed for the time being. The American economy has managed to create 372,000 jobs in the private sector (excluding agriculture), well beyond expectations, without unduly racing wages (+0.3%). As for the unemployment rate, it remains stable at 3.6% of the active population, marking almost full employment, on its pre-Covid levels.
On the values ​​side, in the wake of a relative renewed appetite for cyclicals already observed on Wednesday and Thursday, Stellantis (+3.84% to 12.48 euros) took the lead in the CAC 40, ahead of Unibail (+3, 8%), Publicis (+3.4%), Saint-Gobain (+3%) and Renault (+2.6%). Outside the CAC EDF gained 5.6% pending clarification of the terms of the withdrawal from listing officially announced by the government on Wednesday. Since then, the stock has rebounded by more than 21% (on the other hand, the price is still nearly 90% lower than its historical peaks reached in 2007 before the financial crisis).
On the other side of the Atlantic, the main equity indices ended Friday’s session at levels close to balance, like the Dow Jones (-0.15% to 31,338 points) or the Nasdaq Composite (+0.12% to 11,635 points). The S&P 500, the reference barometer of risk appetite in the eyes of fund managers, contracted very slightly by 0.08% to 3,900 points.
A point on the other risky asset classes: around 08:00 this morning on the foreign exchange market, the single currency was trading at a level close to $1.0140. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $103.30.
To follow as a priority on the statistical agenda this Monday, retail sales in Italy at 10:00 a.m. and the meeting of the Eurogroup (monthly meeting of finance ministers of the Member States of the euro zone). Investors will note that Thursday, July 14, the Paris market will remain open, under the usual conditions of hours and quotations.
KEY GRAPHIC ELEMENTS
The painting (its backdrop in any case) is dark.
The sell signals have multiplied since the combination of “evening star” candles (May 27, 30 and 31). The openings successively in bearish gap of the last two sessions of week 23, then of the first session of week 24, were accompanied by a continuous mobilization of the selling side during the session and closing on the low points of the session. All in sharply rising volumes. The momentum of participation will have followed that of the clearings, even as the CAC will have re-entered the lower part at a bearish slant that retains its resistance attributes.
The technical rebound that began during the week (W25) remains anecdotal at this stage in view of the transaction volumes accompanying it and in view of the initial losses. It came to an early halt, and the resumption of selling pressures, on gaps, on breach of the symbolic threshold (6,000 points), and in high volumes, augurs a continuation of clearances.
Tuesday, July 05, the traced candle combines worrying characteristics, its structure with an elongated body without a wick, materializing a mobilization of the selling camp throughout the session, all in relatively heavy volumes, and on breaking the technical threshold.
The flagship index made a school pullback (graphic rejection) at 6,000 points.
FORECAST
In view of the key graphic factors that we have mentioned, our opinion is negative on the CAC 40 index in the short term.
This bearish scenario is valid as long as the CAC 40 index is trading below the resistance at 6000.00 points.
Hourly data chart
Chart in daily data
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