(News Bulletin 247) – Caution was required yesterday on the Paris market before the Fed’s verdict (well after the close). If the magnitude of the increase in Fed Funds (+50 bps) was not the subject of unbearable suspense, the content of the press conference nevertheless constituted a hot moment for the FOMC. The CAC 40, on reserve, contracted symbolically by 0.71% on Wednesday. It is expected in negative territory at the opening on Thursday, while investors will quickly have to gear up on the outcome of the last ECB Governing Council of the year.
J. Powell, who spoke at a press conference after the FOMC, brushed aside hopes of a pause in the rate hike process in early 2023, an option described as “premature”. A firm stance that surprised a large segment of investors when earlier in the week, the publication of US CPIs had warmed the mood on the equity markets.
Values ​​in Paris, the largest drop in the CAC 40 is accused by Carrefour (-3.79% to 15.605 euros) which suffers both from the poor results of a Belgian comparable, Colruyt, which ends down 15.5 % on the Brussels Stock Exchange, and market share losses in France in November, according to the firm Kantar, quoted by Barclays. On the side of the smallest caps, the biotech AB Science unscrewed by 24.3% after suffering a setback for mastinib, its most important molecule, in Canada.
On the other side of the Atlantic, the main equity indices closed in the red, within relatively narrow margins, on Wednesday after the FOMC, like the Dow Jones (-0.42% to 33 966 points) or the Nasdaq Composite (-0.76% to 11,170 points). The S&P 500, the benchmark barometer of risk appetite in the eyes of fund managers, fell 0.61% to 3,995 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 $1.0650. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $76.60.
To be followed as a priority on the macroeconomic agenda this Thursday, in addition to the ECB’s monetary policy decision (2:15 p.m.) and the press conference (2:30 p.m.), the Bank of England’s monetary policy decision (1:00 p.m.), and for US Retail Sales, Empire State Manufacturing Index, Philly Fed Manufacturing Index and Weekly Jobless Claims at 2:30 p.m.
KEY GRAPHIC ELEMENTS
The courses of the flagship Parisian index are now at the heart of a range between 6,550 points and 6,740 points, in which, until now, the beginnings of a chartist figure 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. Tuesday the courts attempted an excursion, which turned into an incursion. The structure in harami formed yesterday militates in the immediate future for a moderate pullback towards the 20-day moving average (in dark blue).
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 6898.00 points would revive the tension in the purchase. While a break of 6550.00 points would relaunch the selling pressure.
Hourly data chart
Chart in daily data
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