The Paris Stock Exchange limits its initiatives before a busy week
- Advertisement -

(News Bulletin 247) – Losing up to 1.7% at the height of the session, the Paris Stock Exchange reduced its losses to 0.26% at the close. However, risk aversion remains with investors remaining on their guard on the eve of the start of the Federal Reserve (Fed) meeting.

The last few minutes will have been too much for the Paris Bourse, which had managed to return to positive territory, supported by index resistance on Wall Street. Finally, the CAC 40 closed once again down, by 0.26% at 6,061.59 points after having lost up to 1.7% below 6,000 points at the end of the morning. The Parisian place continues a fifth session of decline, bringing its losses to 4.3% over the period.

- Advertisement -

Risk aversion dominated trade on Monday, continuing the trend printed last week during which the CAC 40 had retroceded 2%, undermined by inflation figures in the United States, which came out higher. expectations to.

The markets are worried about the deterioration in the economy and the decision of the American Federal Reserve, the high point of this busy week, particularly on the front of the central banks. At the end of a two-day meeting (Tuesday and Wednesday), the Fed will raise its key rates, an increase the magnitude of which raises questions from investors. The latter currently attribute an 80% probability to a rate hike of 75 percentage points (0.75%) and 20% for a rise of 100 basis points (1%), according to the FedWatch tool. of the CME Group. Its president, Jerome Powell, insisted that the fight against inflation was his priority, even if his policy led the American economy into recession.

“Markets should remain under pressure at the start of the week, then on Fed Day, investors could try to rebound the markets. During previous FOMC [comité de politique monétaire, NDLR], the market rebounded, regardless of the situation before or the tenor of the Fed Chairman’s speech. Thereafter, the evolution of the markets should depend on the tenor of the speech on Wednesday evening”, judge Vincent Boy, market analyst at IG France.

Beyond the Fed, the markets will be attentive to the monetary policy decisions of the Bank of Japan (BoJ) and that of the United Kingdom on Thursday. “In Japan, the policy should remain very accommodating, but we will await the remarks concerning the evolution of the yen and the possible interventions of the BoJ on the Forex, as mentioned last week” continues Vincent Boy.

In the United Kingdom, the Bank of England is also expected on its monetary policy. Engaged in a cycle of rate hikes since the end of 2021, it is struggling for the moment to stem inflation, the highest of the G7 countries at more than 10%. The institution is indeed betting on a continuation of the rise in prices, inflation being expected at more than 13% in October, which according to it will plunge the United Kingdom into recession until the end of 2023.

Valneva in very bad shape

As for values, TF1 and M6 each lost between 2.3% and 3.4% after the announcement of the failure of their merger. The fall of the day is finally limited, the market having integrated this issue with the latest announcements about this project of union between the two chains.

GenSight soars 20% at the close after the announcement of the successful production of the first pilot batch incorporating improvements in the manufacturing process of Lumevoq, a cell therapy aimed at correcting a degenerative disease responsible for sudden blindness.

Valneva, for its part, increased its losses to close down sharply by 19.5% after ending its collaboration with the Austrian IDT Biologika for its vaccine against Covid-19, which translates into total compensation of up to €40.7 million including a maximum of €36.2 million in cash.

Hoffmann Cement returned 5.5%, the French low-carbon cement specialist sold less cement than expected over the past half-year, penalized by delays in construction sites.

As for other assets, the euro lost 0.14% to 1.0009 dollars. Oil contracts are falling again. The North Sea Brent contract for November delivery lost 0.7% to $90.91 while WTI for October delivery lost 0.75% to $84.90.