(News Bulletin 247) – The nervous and unplayful game of yo-yoing continues on the markets, on both sides of the Atlantic moreover, with a backdrop that ultimately does not change: the prospect of a sharp turn in the part of the Fed in 2022 and the geopolitical tensions that do not fall between Moscow and Kiev. Yesterday the CAC 40 gained 1.43% to 7,099 points, accelerating at the end of the bevel, in volumes which contracted, and without federation or sector or factorial.
In terms of statistics, the final data for the manufacturing PMI in the Euro Zone (IHS Markit) for January came out at 58.7, practically on target.
Chris Williamson, Chief Economist at IHS Markit, shed the following light: “Eurozone manufacturers appear to be better able to weather the Omicron variant than previous waves of Covid-19, with the latest PMI data having reported the strongest growth in production and order books for four months in January.The horizon has also brightened for companies, as the slowdown in the increase in supplier delivery times has boosted the morale of manufacturers whose Optimism has thus recovered to its highest level since June.”
Ms Williamson warns, however, of the potential consequences of escalating geopolitical tensions between Moscow and Kyiv, which together with “the energy price crisis and the risk of monetary policy tightening by global central banks have fueled headwinds blowing on the region’s growth prospects. Thus, despite the easing of tensions on global supply chains, the environment is likely to prove less favorable to demand in the coming months.”
Also published yesterday morning, the unemployment rate in the Euro Zone continued to fall, now at 7.0% of the working population.
On the other side of the Atlantic, very satisfactory signals to report on the side of the publications of the manufacturing ISM and new job offers.
On the values ​​side, Safran (+4.09% to 110.98 euros), Wordline (+4.78% to 44.725 euros), Air France (+4.86% to 4.168 euros), or even Faurecia (+5.36 % to 40.70 euros) were sought. On the rest of the rating, Carmat plunged 15.2% after announcing the resumption of implantations (suspended since December due to the occurrence of a quality problem on the prostheses) next October while its financial visibility extends only until December.
The good results of Alphabet have completed a satisfactory picture: that of the quarterly ball of the major technological groups. In the end on Tuesday, the Dow Jones managed to gain 0.78% to 35,405 points and the Nasdaq Composite 0.75% to 14,346 points. The S&P 500, the benchmark barometer of risk appetite in the eyes of fund managers, gained 0.69% to 4,546 points. Note the very marked price/volume divergences for all of these key indices.
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 $1.1240. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $88.30.
To follow on the agenda this Wednesday, to follow in priority the very first estimates of annual inflation (CPI) in the Euro Zone at 11:00 a.m. and across the Atlantic the results of the ADP firm’s survey on employment.
KEY GRAPHIC ELEMENTS
An oblique line of support gave way on Monday under the sectorally federated assaults of the selling camp, in a very high level of participation. This release of selling energy at this stage, in a single session (24/01), constitutes a major technical fact which characterizes the hypersensitivity of a market which is increasingly and continuously questioning the levels of valuation of the shares. . The entry into the bear market is not formally characterized, but the situation calls for the greatest vigilance under this slant. She was reinstated at the very end of the week. We put her under close surveillance.
In the immediate future, plotting a wedge in hourly data is not very engaging.
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 7115.00 points would revive the tension in the purchase. While a break of 6890.00 points would relaunch the selling pressure.
Hourly data chart
Chart in daily data
©2022 News Bulletin 247
Source: Tradingsat
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