(News Bulletin 247) – The CAC 40 lost 0.5% at mid-session, dragged down by Sanofi, which suffered a change in recommendation from Deutsche Bank. The outcomes of the monetary policy meetings of the European Central Bank and the US Federal Reserve will be the major events over the next few days.

After a three-day weekend, since the Paris Stock Exchange was closed on Monday May 1, the CAC 40 is struggling to move forward. The flagship index of the Paris Stock Exchange fell 0.48% to 7,455.41 points at mid-session on Tuesday.

Traders are avoiding risk taking as the two most important central banks, the European Central Bank (ECB) and the US Federal Reserve (Fed), hold their monetary policy meeting in the coming days.

The Fed begins its own on Tuesday, and will complete it on Wednesday evening. This while the rescue of First Republic Bank, an American bank that has been in arrears for several months, finally went through its sale to the juggernaut JPMorgan.

“Even if the First Republic Bank situation is resolved, the Federal Reserve’s monetary policy committee meeting this week will likely include a discussion on the future of the banking system,” Deutsche Bank said.

Sanofi downgraded by Deutsche Bank

The market is widely anticipating a 25 basis point (0.25 percentage point) hike in key rates from the Fed on Wednesday. The whole question will be whether this is not the latest increase in the US central bank’s monetary tightening cycle. For Deutsche Bank, the Fed is expected to signal that a further rate hike in June at its next meeting is an option on the table. Without committing firmly to this path.

And, in addition to these two meetings, investors will also have to dissect the figures on American employment, which will be published on Friday afternoon.

Obviously, the results of companies will still be numerous this week, with in particular Apple on the menu or Airbus and BNP Paribas in France.

As for values, the CAC 40 was dragged down by Sanofi, which suffered from a degradation of advice on the sale by Deutsche Bank.

Securities overdue last week benefit from repurchases on good accounts. This is the case of Teleperformance (+3.8%) and STMicroelectronics (+3.3%).

On the smallest capitalizations, Vilmorin jumped by 45%, the price of the seed company being based on the price of the public tender offer of its majority shareholder with a view to its withdrawal from the listing.

Medincell takes 15%, driven by the approval of a drug to fight schizophrenia in the United States.

Fitch has no big impact on France’s 10-year bond

McPhy lost 3.6%, penalized by the suspension of a large order in Guyana.

On the other markets, the euro lost 0.2% against the dollar at 1.0952 dollars. Oil prices are trending down slightly. The June North Sea Brent contract fell 0.5% to $78.93 a barrel while the May WTI contract listed in New York fell 0.6% to $75.23 a barrel.

Note also that on the bond market, the 10-year debt rate for France increased, trading at 2.95% against 2.895% on Friday evening, after the lowering of France’s rating by the Fitch rating agency. But difficult to see, in reality, any impact of the decision of the agency since the yield of the debt of the same maturity of Germany knows an increase of the same magnitude.