(News Bulletin 247) – Relieved by confirmation of a slowdown in prices on both sides of the Atlantic, the Paris market will have spent the last part of the week in excellent conditions, with a sharp rebound in the most attacked from March 10 to 20, on banking, automotive equipment and technology. The start of the bank fire, which was quickly brought under control, did not spoil the good results of the CAC 40 in the first quarter: +13.11%!
Besides Atlantic, PCE prices (personal consumption expenditures), excluding food and energy, progressed “only” by 0.3% in February, against a month of January at +0.6%. The consensus certainly foreshadowed a slowdown in the rise in prices, but less significant (+0.4%). Enough to ease the pressure on the Fed when it had a lot to do in its last weeks to put out the beginning of a fire caused by the bankruptcy of the Silicon Valley Bank. The justification for a slowdown in its own pace of rate hikes is mechanically gaining credence, although this trend towards price deceleration must naturally be sustained over time. In any case, this PCE figure is all the more “impactful” as it is the measure favored by the Fed in its assessment of inflation.
Earlier in the day, operators took note of the slowdown in the rise in consumer prices throughout the euro zone following the announcement of a similar trend in Germany and Spain. The annual inflation rate in the euro zone fell in March for the fifth consecutive month, thanks to the lull in energy prices. It stands at 6.9% over one year, after 8.5% in February, according to Eurostat. Note, however, a rise in core inflation (which excludes food and energy prices) to 5.7%, which could lead the ECB to raise its rates further.
On the values ​​side, BNP-Paribas gained 1.25% to 55.21 euros, Dassault Systèmes 1.60% to 37.87 euros and Wordline 2.19% to 39.11 euros. Excluding the flagship index, Air France-KLM ended the week up 4.2%, with several analysts showing their support for the airline, including Deutsche Bank. The design office went on the purchase on the title with a target price of 2.30 euros.
On the other side of the Atlantic, the main equity indices ended in green territory, within comfortable margins, like the Dow Jones (+1.26% to 33,274 points) and the Nasdaq Composite (+ 1.74% at 12,221 points). The S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, gained 1.44% to 4,109 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 $1.0800. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $78.90.
To be followed as a priority on the macroeconomic agenda this Monday, the industrial PMI in the Zone at 10:00 a.m. (final data for March), as well as the manufacturing ISM at 4:00 p.m. (final data for March in the United States).
KEY GRAPHIC ELEMENTS
Symbolically, the CAC quickly erased the remainder of the March 10 gap during Thursday’s session, retracing all the losses suffered since the start of the banking crisis. A rapid drop below 7,225 points would herald a second episode of correction, while staying above would mean engaging in a consolidation phase below the highs.
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.
The News Bulletin 247 board
Hourly data chart
Chart in daily data
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