CAC 40: The 7,200 points hold up, after the Minutes and the NVidia copy

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The Fed Minutes and the NVidia results will ultimately not have catalyzed any movement, downwards or upwards yesterday, in the absence of major surprises.

NVidia, however, had “no room for error” as recalled by Ipek Ozkardeskaya, analyst at Swissquote Bank cited by AFP, as the actor has become a symbol, a barometer of a theme (AI) which has created a lot of value on the stock market in recent months. And it is clear that, without enthusing the crowds in the sense of post-market trading, the specialist in graphics cards, member of the Magnificent 7, has published excellent results and raised its prospects.

Yesterday the CAC 40 showed caution, contracting by 0.24% to 7,229 points, preserving the 7,200 points, penalized by automobile manufacturing, luxury and tech. Kering lost 0.93%, Wordline 1.74%, Teleperformance 1.78%, LVMH 1.89%, Stellantis 1.90% and Renault 3.47%. Concerning LVMH, whose weight in the index is very strong, the stock was penalized by UBS which downgraded its recommendation on the stock of the luxury giant to neutral.

The Minutes, the traditional report of the Fed’s last monetary policy meeting, did not make it possible, as hoped, to further refine the probabilities of reaching, already or not, terminal rates. Above all, the opportunity to take stock of the time the Fed is giving itself to maintain rates at such a high level.

“Without a doubt, the “growth” theme will become central in the coming quarters and take precedence over the “inflation” theme,” says Thomas Giudici, head of bond management at Auris Gestion.

“A “soft landing”? And it is the favorable scenario of the “Goldilocks” which could be put in place, the “ideal path” hoped for by Jerome Powell. Last week was also able to give us an overview of the financial markets with a solid increase in stock market indices. In the case of a more marked recession, which is not the central scenario currently, the situation would however be different for risky markets, even in the case of a decline central bank rates.”

The term Goldilocks, which means Goldilocks, is borrowed from a character in a popular tale, Goldilocks and the Three Bears, where a little girl discovers an empty house in the heart of the forest. Attracted by the tempting smell of bowls of hot chocolate (or porridge, depending on the version!), the little girl indulges in tasting the 3 bowls lined up on the table: that of Mama Bear, Papa Bear, and the little one. bear cub. His preference is for the latter, neither too hot nor too cold…

“In economics, the “Goldilocks” scenario refers to an optimal situation where growth is modest, but very real, and inflation is moderate,” explains Christopher Dembik, investment strategy advisor at Pictet AM.

Austan Goolsbee, the president of the Chicago Fed, even speaks of an “unusual feat” for the American economy with a record drop in inflation (excluding war periods) without a recession.

On the other side of the Atlantic, the main equity indices have

An update on other risky asset classes: around 8:00 a.m. this morning on the foreign exchange market, the single currency was trading at a level close to $1.0910. The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $77.60.

On the agenda this Wednesday, across the Atlantic, orders for durable goods and weekly registrations for unemployment benefits at 2:30 p.m., as well as revised data from the consumer confidence index (U-Mich) at 4:00 p.m.

KEY GRAPHIC ELEMENTS

The 7,200 points, the technical issue of last week, were exceeded, with the weekly candle closing at its peaks. The flagship Parisian index is now entering a phase of digesting its gains, in the form of a consolidation whose graphic pattern is still being determined.

FORECAST

Considering the key graphical 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 7406.00 points would revive the buying tension. While a break of 7200.00 points would restart the selling pressure.

Hourly graph

Daily Data Chart