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In a starving level of participation, the CAC 40 contracted by 0.21% on Monday to 7,303 points, the agreement in principle found between Biden and McCarthy on the debt ceiling not in any way sufficient to whet any appetite. for the risk. Anyway, the initiatives could only be extremely limited, because of the public holiday nature of this Monday in France (Pentecost) and the closure of Wall Street (Memorial Day).

An agreement in principle has therefore just been reached this weekend between Joe Biden and the leader of the opposition, the Republican McCarthy. A necessarily imperfect agreement, which has the counterpart of significant budget cuts. There are now a handful of days left to vote on the text in both Chambers.

No macroeconomic figures came to liven up the session yesterday. As a reminder on Friday, investors took a back seat to the release of consumer income and spending figures for April, including those from the PCE index, the US Federal Reserve’s (Fed) preferred gauge for measuring inflation. This indicator increased by 4.4% over one year against 4.2% the previous month. The underlying “core PCE” index, which excludes volatile data such as food and energy, accelerated to 4.7% year on year from 4.6% the previous month. For their part, US household spending rose more than expected, by 0.8% in April, while their incomes also rose (+0.4%).

On the value side, files with a strong current Beta effect lost significant ground yesterday, like Soitec (-2.46%), Wordline (-2.72%) or Faurecia (-3.54%). Casino Guichard lost an additional 1.98% (-6.43% on Friday), in full negotiation with its creditors on a restructuring of its debt. Finally, Orpea fell 2.6% after announcing that the Financial Markets Authority had granted a waiver to a group led by Caisse des Dépôts on the obligation to make a mandatory public offer (OPA). This group is to take control of the company following the financial restructuring planned by the group.

On the other side of the Atlantic, the main equity indices gained ground on Friday, like the Dow Jones (+1% to 33,093 points), but especially the Nasdaq Composite (+2.19% to 12,975 points). The S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, gained 1.30% to 4,205 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 $1.0680. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $72.30.

On the macroeconomic agenda on Tuesday, the very closely followed US consumer confidence index (Conference Board) at 2:30 p.m., expected in the immediate vicinity of 99 points.

KEY GRAPHIC ELEMENTS

We placed the 7,310 point threshold under close surveillance, which was pushed down, on a wide gap, in high volatility, and in a rising volume level. A short reaction took place at the end of the session from the upper limit of the thin gap of March 30, a level which remains threatened. Next downside target: 7,088 points, before a protest reaction.

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.

The News Bulletin 247 board

CAC 40
Negative
Resistance(s):
7585.00 / 7740.00
Medium(s):
7234.00 / 7088.00 / 7015.00

Hourly data chart

Graphic made from the software Prorealtime

Chart in daily data

CAC 40: Return of sharp benchmarks this Tuesday (© ProRealTime.com)
Graphic made from the software Prorealtime

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