(News Bulletin 247) – The continuation of Beijing’s “efforts” to soften a health policy that has become unbearable for a section of the population is not enough to reassure a market that is worried about the recent signs of overheating of the American economy ( NFP, ISM Services), signals that sweep away hopes of an accommodative attitude from the Federal Reserve. The CAC index contracted on Wednesday by 0.41% to 6,660 points.
In terms of statistics, German industrial production fell back in October (-0.1%) but much less than expected. Note that Q3 GDP data in the Euro Zone has just been revised upwards, to +0.3% quarter on quarter.
Values ​​in Paris, Sanofi, which gained 6.1% following a favorable judgment on Zantac in Florida, a case that concerns other large pharmaceutical groups. Kering shows the largest drop in the CAC 40 (-4.15%), suffering from a lowering of the recommendation by UBS from buy to neutral. Airbus for its part lost 2.2%, after abandoning its delivery target for the 2022 financial year. Euroapi plunged 15.7%, after lowering its annual objectives following the suspension of part of its production in Hungary.
On the other side of the Atlantic, the major equity indices were hesitant, with the Dow Jones ending in perfect balance at 33,597 points, and the Nasdaq Composite contracting 0.51% to 10,958 points. The S&P 500, benchmark barometer of risk appetite in the eyes of fund managers, symbolically rose 0.19% to 3,933 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 $1.0510. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around 74.30$.
To follow as a priority on the statistical agenda this Thursday, the weekly registrations for unemployment benefits in the United States. What to gauge more, after the NFP at the end of last week, tensions on the job market.
KEY GRAPHIC ELEMENTS
The prices of the flagship Parisian index are now at the top of a range between 6,550 points and 6,740 points, in which, until now, the beginnings of a chartist pattern were emerging. This would only continue in the event of a decline in the lateral channel. Conversely, a clear overshoot, on an uncontested gap for example, would pave the way for a rapid achievement of 6,900 points. In the immediate future, a new breath in prices below 6,740 points is the preferred scenario, which was confirmed by the content of the NFP report on Friday. Technically, there is no solid enough material support to oppose a consolidation towards 6,550 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 6740.00 points.
Hourly data chart
Chart in daily data
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