(News Bulletin 247) – The Parisian index ended up on Monday, set a new session record and was on the verge of hitting another at the close.
The CAC 40 started the week well. The flagship index of the Paris Stock Exchange set a new record during the session, at 7401.15 points and was very close to reaching a closing record. The CAC 40 finally took 0.34% to 7,373.21 points. The previous record, from January 2022, at 7,376.37 points, still stands but has shaken.
Investors are showing some optimism about upcoming rate hikes by the US Federal Reserve (Fed), currently pricing in 70% on a 25 basis point hike, or 0.25%, in the next meeting, March 22.
Heading towards American employment
The good trend of the end of last week continues as well. “The markets are regaining the confidence they never lost. Bostic’s comments [le président de la Fed d’Atlanta, NDLR] last Friday, allowed the American indices to stay on the technical supports again and an upward acceleration to close the week”, recalls Vincent Boy, market analyst at IG France.
Still, these expectations could be undermined, or on the contrary reinforced, by the hearings, Tuesday and Wednesday, of the President of the Fed, Jerome Powell, before the two chambers of the American Congress.
“Jerome Powell’s speeches on Tuesday and Wednesday before the American Congress should make the markets volatile. He must speak out in order to justify the monetary policy put in place, its effectiveness against inflation, and the outlook of its evolution”, emphasizes Vincent Boy.
Another event likely to influence market expectations: the US employment figures for the month of February, which will be published on Friday afternoon. This publication can sometimes cause considerable movements on the equity and foreign exchange markets.
Atos and Elior in the spotlight
Coming back to this Monday, market operators also take note of the Chinese government’s announcement of a modest growth target of just 5% for 2023.
“It’s safe to say that markets were taken aback by the decision to target just 5% growth this year, while not signaling any meaningful stimulus to spur economic recovery,” notes Craig Erlam of Oanda.
As for values, pending the burst of annual results with in particular the end of the season for the CAC 40, Elior advanced by 6.2% after signing an agreement to take over the multi-service branch of metal recycling specialist Derichebourg.
Atos gained 7.6%, boosted by an increase in advice to buy from Bank of America.
Accor (+2.9%) was also carried by an increase in recommendation, to “overweight”, from Barclays.
Bonduelle (-4.4%) suffered profit taking after gaining more than 5.5% on Friday, following half-year results deemed satisfactory by the market.
On other markets, the euro gained 0.6% against the dollar at 1.0685 dollars. Oil is losing ground. North Sea Brent crude for May delivery fell 0.5% to $85.38 a barrel while New York-listed WTI for April delivery fell 0.2% to $79.49 a barrel.
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