(News Bulletin 247) – Optimism confirmed at the start of 2023, with a further rise on Friday (+0.69% to 7,023 points), in solid volumes although decelerating. The balance sheet ytd (since January 1) now stands at +8.50%. However, the rise of the Parisian place had lost intensity at the beginning of the afternoon, the investors were scalded by the comments of the American banks on a possible recession and an increase in their provisions in this perspective.
The market nevertheless remains relieved with the support of US inflation figures in December, which were confirmed on Thursday. a marked slowdown in the rise in prices. As a reminder, the consumer price index for the widest product base came out perfectly within the target, at +6.5% on an annual basis. What bring a certain relief without blowing the cork of the bottle of champagne.
The confirmation is that of a marked slowdown in the rise in prices on the other side of the Atlantic, even if the road to a landing in inflation will still be long. The fight, through a firm monetary policy, will clearly have to continue.
In terms of values on Friday, Air France-KLM finished at the top of the SBF 120 index with an increase of 6%. The airline group benefited from higher recommendations from Davy Research and UBS as well as several positive signals for the sector as a whole. The automotive sector was particularly hard hit by price cuts by Tesla. In Paris, Stellantis lost 3.8%, posting the largest drop in the CAC 40. Renault also fell (-1.45%). Bouygues fell for its part by 3% penalized by a lowering of recommendation from Morgan Stanley to “underweight”.
On the other side of the Atlantic, the main equity indices gained ground on Friday, thanks in particular to the publication of consumer confidence (U-Mich, preliminary data), which clearly beat expectations. The Dow Jones gained 0.33% to 34,302 points and the Nasdaq Composite 0.71% to 11,079 points. The S&P 500, the benchmark barometer of risk appetite in the eyes of fund managers, rose 0.40% to 3,999 points. It should be noted that Wall Street will remain closed this Monday, due to a public holiday: Monday, January 16, 2023 (Commemoration of the birth of Martin Luther King).
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 $1.0830. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $80.00.
To be followed as a priority on the macroeconomic agenda on Monday, the meeting of the Eurogroup (an informal body which brings together the ministers of the countries of the euro zone to examine issues related to the euro).
KEY GRAPHIC ELEMENTS
This ability to close exactly on the weekly highs is interesting at this stage (S1), and must be confirmed by the volumes and the sector federation to consider a more lasting grip on the buying side. In the absence of such confirmations, entry into a highly volatile consolidation pattern, with an uncertain exit direction, is the preferred option. In the immediate future in any case, no divergence between price and oscillatory RSI is to be noted. The issue on Friday was once again the validation of a close close to the weekly highs (S2). This ability has been validated.
FORECAST
In view of the key graphic factors that we have mentioned, our opinion is positive on the CAC 40 index in the short term.
This bullish scenario is valid as long as the CAC 40 index quotes above the support at 6760.00 points.
Hourly data chart
Chart in daily data
©2023 News Bulletin 247
I have over 8 years of experience working in the news industry. I have worked as a reporter, editor, and now managing editor at 247 News Agency. I am responsible for the day-to-day operations of the news website and overseeing all of the content that is published. I also write a column for the website, covering mostly market news.
