(News Bulletin 247) – Without Wall Street, its traditional benchmark closed for a public holiday, the Paris Stock Exchange started the week with a sharp decline after restrictive comments from a member of the ECB. The CAC 40 fell by 0.72% on Monday evening, at the start of a busy week in major economic indicators.
Deprived of Wall Street, the Paris Stock Exchange was not in good spirits on this third Monday in January, often wrongly presented as being the most depressing day of the year.
The CAC 40 lost 0.72% to 7,411.68 points this Monday evening, after completing its first week in positive territory for the year 2024.
The volumes traded were lower than usual with 2.06 billion euros, while on the other side of the Atlantic traders were able to take advantage of a day of rest on January 15, a public holiday federal commemorating the birth of Martin Luther King. French operators will have to be patient and wait until Friday March 29 to benefit from a public holiday (Good Friday, which precedes Easter Monday).
And these are the words of a member of the European Central Bank which dampened the hopes of investors who were awaiting possible monetary easing from the institution from the month of April. “The European Central Bank could defy market expectations and not start lowering interest rates throughout 2024,” Robert Holzmann told CNBC on Monday.
“I fear that by leaving Davos, these people will be deeply disappointed,” continued the governor of the Austrian central bank.
These restrictive comments come after those of Philip Lane, chief economist of the ECB, who declared this weekend that reducing rates too quickly could fuel a new wave of inflation. And they had the effect of fueling tensions in the bond compartment, the yield on the German 10-year bond rose to 2.20% and that of the French debt of the same maturity increased to 2.73%.
The two members of the ECB undermined investor morale already well underway after the announcement this Monday morning of a contraction in German gross domestic product for 2023 of 0.3%. In the fourth quarter, GDP also fell by 0.3% after stagnating in the third quarter. Technically, Germany therefore narrowly avoids recession, which involves two consecutive quarters in the red. But this is just a simple semantic consideration.
The agenda will pick up on Tuesday with the publication of several indicators including the second estimate of inflation in Germany and the Zew index, which measures the confidence of investors across the Rhine.
We will then have to monitor, on Wednesday, retail sales in the United States, the publication of the Beige Book of the American Federal Reserve, which provides an overview of the economic situation in the United States, and on Friday the consumer confidence index of the University of Michigan (U-Mich) for January.
Atos at its worst, Dassault Aviation grounded
Atos dropped 15.1% after announcing the departure of its general manager as well as a warning on its cash flow for 2023.
Dassault Aviation dropped 6.4% after publishing aircraft deliveries below its targets for 2023.
L’Oréal for its part lost 4.8% while UBS went from buy to “neutral” on the stock, judging that the share’s potential is now limited, given the recent outperformance of title.
Conversely, Solutions 30 increased by 1.9% after signing a new contract relating to the deployment of optical fiber in Germany.
After losing more than 10% in the morning, Carmat finally finished in the green (+0.95%) despite the announcement of results lower than forecasts as well as the upcoming launch of a capital increase in the very short term.
On other markets, the euro is almost stable against the dollar, at 1.0950 dollars. Oil contracts are taking a break. Brent from the North Sea for delivery in March lost 0.4% to 78.01 dollars per barrel, while WTI listed in New York for delivery in February also fell 0.5% to 72.44 dollars per barrel. .
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