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At the end of a difficult session, the CAC 40 managed to climb 0.28% to 7,381 points, in declining volumes, with the graphic result of a candle in perfect doji. A market that oscillates between the relief of immediately avoiding a phase of recession across the Atlantic, the resurgence of fears about American regional banks, and doubts about the quality of the Chinese economic recovery.
Wall Street will have a negative influence on the session for a while. PacWest, identified as the weak link in the system, announced a decline in its deposits last week. For its part, Disney pulls the Dow Jones down, the entertainment giant having announced a decline in its subscriber base in the first quarter.
Regarding the United States, “the slowdown remains the central concern, both in terms of economic growth and profit growth,” says Laura Corrieras, Equity Portfolio Manager, Indosuez Wealth Management. “At the start of the earnings season, we are seeing a certain caution, both from financial analysts and companies, more inclined to lower their outlook than usual. The evolution of monetary policy and the first quarter results will be the main catalysts for the markets in the coming weeks.”
However, the latest federal monthly employment report proved to be solid enough to bring real relief on this point. Even at the risk of seeing the Fed shorten its monetary pause…
In the American statistical department, the producer price index, up 0.2% in April, came out in line with the target. Moreover, the weekly registrations for unemployment benefits, although exceeding the consensus by 20,000 new units, still betray recurring tensions on the employment front.
On the value side, DBV Technologies finished at the top of the SBF 120 orders, the biotech gained 9.8% after announcing convincing results as part of its phase 3 Epitope study evaluating its product Viaskin Peanut in children aged 1 to 3. years. French biotech is followed by Beneteau (+8.4%), which published like-for-like revenue growth of almost 50% in the first quarter and raised its objectives for the year 2023. Solutions 30 limits its gains to 2.7%, despite growth that exceeded 14% in the first quarter, thanks to the jump in revenues in the Benelux region (Belgium, the Netherlands and Luxembourg).
Across the Atlantic, major equity indices ended Thursday’s session in mixed order, with the Dow Jones contracting 0.66% to 33,309 points with banks and Disney, and the Nasdaq Composite managing to glean 0.18% to 12,328 points. The S&P 500, benchmark barometer of risk appetite in the eyes of fund managers, dropped some 0.17% to 4,130 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 $1.0970. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $73.10.
To be followed as a priority on the macroeconomic agenda this Friday, the consumer price index in France at 8:45 a.m. and the American consumer confidence index (U-Mich) at 4:00 p.m.
KEY GRAPHIC ELEMENTS
Beware of the probable commitment of the three-color flagship index in a shoulder, head and shoulders pattern above a graphic base materialized by the bullish gap of March 30, below 7,235 points. We will watch like the milk on the fire, the continuation if necessary of this route to identify work scenarios. The breakout of 7,316 points would accelerate the release towards the aforementioned level.
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 7585.00 points.
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