CAC 40: heavy atmosphere

(News Bulletin 247) – In good spirits in the very first part of the session on Tuesday, the CAC 40 index will not have been able to transform the test of the technical rebound, in particular in the absence of sufficient support from Wall Street. The increasingly clear prospects of an entry into recession in the Euro Zone in the coming months are weighing on equities, Growth as Value. The flagship Parisian index contracted by 0.27% to 5,753 points yesterday, weighed down in particular by Kering (-3.10% to 458.40 euros) and BNP (-2.38% to 45.11 euros) .

This trend reversal occurred at the very end of the session, while tensions on the geopolitical front have escalated. Moscow again brandished the threat of nuclear weapons to defend the territories it occupies in Ukraine. In addition, three major leaks in the NordStream 1 and 2 gas pipelines in the Baltic Sea were identified on Tuesday by the Danish army.

On the macroeconomic side, there was little to eat yesterday, while waiting for US PCE prices and GDP in final data for the second quarter, in the last part of the week. Note the publication, beyond expectations, at 108, of the consumer confidence index (Conference Board).

“Central bankers have reaffirmed their determination to raise rates to break the inflationary cycle. Both the Fed and the ECB have made this a top priority, even if it is to be accompanied by a recession, which is considered less of a concern than a risk. hyper-inflation”, summarize the strategists of the firm Leduc & associés.

On the other side of the Atlantic, the main equity indices ended Tuesday’s session in mixed order, with the Dow Jones contracting 0.43% to 29,134 points and the Nasdaq Composite managing to extricate itself into territory. positive (+0.25% to 10,829 points). The S&P 500, benchmark barometer of risk appetite in the eyes of fund managers, lost 0.21% to 3,647 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 $0.9560. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $77.50.

To follow as a priority on the statistical agenda this Wednesday, across the Atlantic, the trade balance of goods at 2:30 p.m., housing sales in progress at 4:00 p.m., and crude stocks at 4:30 p.m.

KEY GRAPHIC ELEMENTS

The symbolic 6,000 points were broken under validating conditions of volume and volatility, and the new work zone identified between 5,785 and 6,000 points will have been crossed in one go last week. At this stage, the possibility of a technical reaction will take shape. We lacked the materialization of the conditions for its implementation.

We mentioned Monday morning the possibility of a candle in harami or sharp downward acceleration from the start of the session. It is actually in “inverted hammer” which comes to give us a signal of the same nature. Unfortunately it was not validated by the next candle, red and without any lower shadow. Only the ability to close above the September 26 highs would reinforce the idea of ​​the rapid development of a technical rebound.

FORECAST

In view of the key graphic factors that we have identified, our opinion is neutral on the CAC 40 index in the short term.

We will take care to note that a crossing of 5858.00 points would revive the tension in the purchase. While a break of 5360.00 points would relaunch the selling pressure.

Hourly data chart

Chart in daily data

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