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It’s time for the consolidation of the recent advance on the CAC 40, which pressed the “pause” button yesterday (-0.01% to 7,345 points), weighed down by Wall Street, while the week is rich, very rich even, in benchmarks on American employment (new JOLTS offers, ADP survey, Challenger job cuts, registrations for unemployment benefits and NFP report at the high point on Friday. Because if PCE prices on Friday highlighted a slowdown price dynamics, the degree of tension on the labor market remains closely watched.
Just as will be the rest, the dynamics of rents, which enters, across the Atlantic, in the baskets used to measure inflation. Emmanuel Auboyneau, Managing Partner, would like to add the following nuance: “the other driving force behind US inflation [en plus du gonflement salarial] is the continuous increase in rents, largely due to a structural housing deficit. There is a tremor in the construction sector which gives hope for an imminent inversion of the curve. The stabilization and then the fall in rents will be a determining factor in controlling US inflation.”
Hence a dilemma for central banks, in particular the Fed whose “work is not finished”, and “should lead to at least one or two additional rate hikes by the summer, before a period of stabilization .”
In terms of values ​​on Monday, L’Oréal appreciated by 1.18% to 420.30 euros after signing an agreement with Natura & Co for the acquisition of Aesop, an Australian brand of luxury cosmetics, worth $2.525 billion business. Michelin took 1.6% benefiting from a research rating from UBS. The Swiss bank raised its price target from one euro to 36 euros on the bibendum group, the only one it recommends for purchase in the universe of tire manufacturers, due to an excessively depreciated valuation, according to her.
On the other side of the Atlantic, the main equity indices have consolidated, like the Dow Jones (-0.59% to 33,402 points) or the Nasdaq Composite (-0.52% to 12,126 points ). The S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, fell 0.58% to 4,100 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 $1.0950. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $80.90.
To follow as a priority on the macroeconomic agenda this Wednesday, the survey of the private firm in HR ADP at 2:15 p.m. and the ISM American services index in final data at 4:00 p.m.
KEY GRAPHIC ELEMENTS
Beneath its historic highs, the flagship Parisian index stalls, under a resistance zone that is asserting itself. In the immediate future, the entry into a phase of consolidation of the recent and lively progress. A work band is designated: between the gap of March 30 (lower limit at 7,201 points, and the historical highs at 7,401 points, i.e. a range of 200 points.
FORECAST
In view of the key graphic factors that we have mentioned, our opinion is negative on the CAC 40 index in the short term.
This bearish scenario is valid as long as the CAC 40 index is trading below the resistance at 7422.00 points.
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