(News Bulletin 247) – This ability to see the glass half full still predominates over the CAC 40, which managed to grab 0.52% yesterday at 7,032, going back above the symbolic and psychological threshold of 7,000 points, on hope that the Fed will become more accommodating. Operators hope to see the US Federal Reserve ease its footing on rates at its next meeting as, according to the Wall Street Journal, the US institution is preparing the ground for a 0.25 point hike, not a 0.5 point hike. its key rates at the end of its February 1 meeting.
“The inflection in the rise in rates seems to be confirmed for the members of the FOMC, despite the exits (unsurprisingly) of James Bullard and Loretta Mester who are still campaigning for more marked increases”, notes Thomas Giudici, head of management bondholder of Auris Gestion.
A different story on this side of the Atlantic, with a statement deemed “hawkish” (restrictive, bellicose) from one of the members of the European Central Bank (ECB). Klaas Knot, governor of the Bank of the Netherlands and therefore de facto member of the ECB’s governing council, told the Batavian press on Saturday that increases of 50 basis points (0.50 percentage points ) in the key rates of the euro zone central bank at its next two meetings, in February and March. Then “expect that we will not be finished by then and that other measures will follow in May and June”, he added according to comments relayed by the Reuters agency.
“Several members of the ECB, among the most virulent, came out of the woodwork to remind us that the market was still too complacent with rates,” added M Giudici.
In terms of statistics, the index of leading indicators (Conference Board) disappointed, sinking further, and missing expectations, casting doubt on the capacity for a “soft” landing (the famous soft landing) of the American economy.
On the stock side, Atos ended up 2%, while the engineering company Astek declared to the JDD its interest in the Evidian division that Atos plans to IPO in the second half of 2023. Rémy Cointreau appreciated of 2.8%, while Citi revised its advice to buy on the title against “neutral” previously. Unibail-Rodamco-Westfield and Icade ended respectively up 4.8% and 3%, supported by Exane BNP Paribas, which moved to “outperformance” against “neutral” on both issues.
On the other side of the Atlantic, the main equity indices once again closed in green territory, like the Dow Jones (+0.76% to 33,629 points) and the Nasdaq Composite (+2, 01% to 11,364 points). The S&P 500, the benchmark barometer of risk appetite in the eyes of fund managers, gained 1.19% to 4,019 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 $1.0890. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $81.60.
To be followed in priority on the macroeconomic agenda this Tuesday, the first estimates (flash data) of the PMI activity indicators. Synthetic data for the entire Euro Zone will be released at 10:00 am.
KEY GRAPHIC ELEMENTS
The flagship tricolor index began on Thursday 01/19, on a candle with an elongated red body, without shadow, a legitimate phase of correction, limited in absolute value, with regard to the initial advance since the beginning of the year. The amplitude of this phase of profit-taking will serve as a framework for a pattern of consolidation to come. Note the increase in the gap, at this stage, between the 20-day moving average (in dark blue) and its 50-day counterpart (in orange), with a marked bullish bias.
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 7422.00 points would revive the tension in the purchase. While a break of 7000.00 points would relaunch the selling pressure.
Hourly data chart
Chart in daily data
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