(News Bulletin 247) – The CAC 40 gained 0.1% on Thursday, investors digesting the words of the President of the Federal Reserve, Jerome Powell. Wall Street supported the trend and Sanofi made good progress.

The CAC 40 looked for a trend during the session, but ended up slightly higher. The flagship index of the Parisian place signed an increase of 0.11% to 7,139.25 points.

The good session of Wall Street allowed the Parisian place to switch to the good side. Shortly before the European close, the S&P 500 gained 1.4% and the Nasdaq Composite took 2.1%. US markets had fallen sharply the day before, following announcements by the Federal Reserve (Fed) and statements by its chairman, Jerome Powell, but also those of Treasury Secretary Janet Yellen.

Fed concerned about banking turmoil

The Fed, as expected by the market, raised its key rates by a quarter of a point, or 25 basis points or 0.25%. But the overall message sent by the institution and the statements of its president, Jerome Powell, left investors skeptical. “The Fed raised its interest rate by a quarter point, as expected, but acknowledged the impact of the recent banking turmoil and signaled that it may be on the verge of pausing the tightening cycle” , remarks UBS.

The Fed’s “rhetoric” “raised concerns about banking conditions and the likelihood of an economic recession, which drove markets lower,” said Tina Teng of CMC Markets.

In addition, Jerome Powell’s press conference came at the same time as Treasury Secretary Janet Yellen’s speech. The latter ruled out the possibility of guaranteeing all of the deposits of American banks without obtaining the approval of the American Congress.

Investors were nevertheless able to find signs of comfort in the new weekly jobless claims in the United States, published on Thursday afternoon. Over the last week, they stood at 191,000 units, below the consensus of economists (198,000) and less than those of the previous week (192,000). This can be seen as a sign of the resilience of the US economy in the face of tightening credit conditions, in particular.

Featured Sanofi

In terms of values, Sanofi (+5.5%) was driven by successful clinical results for its flagship drug, Dupixent, which could potentially be used to treat “smoker’s bronchitis”.

Conversely, Teleperformance lost 2.6%, the market worrying about the group’s decision to finally pursue the moderation of shocking content, a source of controversy. At the end of 2022, the company had initially decided to end this activity.

Casino suffered, falling 9.5%, while its parent company Rallye lost 10.9%. The latter published its annual results on Wednesday evening. Under judicial safeguard proceedings since 2019, like the other holding companies of Jean-Charles Naouri, CEO of Casino, Rallye announced that “the risk factor linked to the implementation of safeguard plans [était] increased”.

The company indicated that it was going to approach its creditors “in order to examine the possibilities and the possible modalities of the development of its safeguard plan”. Debted to the tune of 2.82 billion euros, Rallye must repay in 2025 a total of 2.067 billion of various liabilities, according to the safeguard plan. However, the execution of this plan depends mainly on Casino’s ability to pay dividends, which the distribution group does not intend to do for the 2022 financial year. Rallye’s difficulties could force Casino to accelerate its deleveraging and sell assets under pressure.

Arriving on the SBF 120 on Monday, Beneteau (-3.5%) and Voltalia (-8.8%) found themselves under pressure following the publication of their annual results.

On the other markets, the euro took 0.3% against the dollar, to 1.0895 dollar. Oil prices are moving up a bit. The May contract on Brent from the North Sea rose 0.4% to 77.02 dollars a barrel while that of the same term on WTI listed in New York took 0.3% to 71.07 dollars a barrel.