CAC 40: Nervously approaches the statistical highlight of the week

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The CAC 40 fell 0.93% to 8,016 points, while preserving the highly psychological threshold of 8,000 points on Thursday, as the markets became aware of a significant slowdown in American growth. A figure which could have pleased the market by evoking the idea of ​​a soft landing, if it was not accompanied by signals of tension on prices.

The gross domestic product (GDP) of the United States grew less than expected, by 1.6% in the first quarter, according to a first estimate. Economists surveyed by the Wall Street Journal, for their part, expected an increase of 2.2% on an annual basis. Meanwhile, inflationary tensions persist since the underlying inflation indicator increased against all expectations, by 3.7% over the first three months of the year, after 2% in the fourth quarter. Another leading indicator of price tensions, new weekly unemployment registrations were also lower than expected, at 207,000 the previous week, against a consensus of 215,000.

It is in this context that operators will learn this Friday of the statistical highlight of the week, namely the PCE prices (personal consumption expenditures), the Fed’s favorite barometer in its assessment of inflation. Core data (excluding volatile items) is expected to increase monthly by 0.3%.

Furthermore, the market had to endure an avalanche of quarterly publications, with contrasting content to say the least.

Dassault Systèmes lost 4.24% after quarterly results described as “mixed at best” by Stifel.

Hermès lost 2.44% despite vigorous growth of 17% excluding currency effects in the first quarter, against a consensus of 14%.

Pernod Ricard returned 2.45% as its sales disappointed investors in the third quarter.

Carrefour was not positive this Thursday (-2.2%) with revenues also less dynamic than expected by analysts, and a lowering of recommendations from Morgan Stanley to “online weighting” against “overweight” previously. .

Sanofi jumped 4.5% after revealing results “a little above expectations”, according to Oddo BHF, which allows it to take the lead in the CAC 40 this Thursday evening.

STMicroelectronics has not deviated from its reputation as a volatile value. The stock closed up 1.1% after opening down 5%. The group lowered its annual revenue target and delivered results that were worse than expected. But the market judges a priori that the bottom of the wave has now passed for the semiconductor specialist.

BNP Paribas gained 0.9% thanks to a net profit above expectations thanks to results driven by its “corporate and investment banking” division.

On the other side of the Atlantic, the main equity indices ended Thursday’s session in the red like the Dow Jones (-0.98%) or the Nasdaq Composite (-0.64%). The S&P500, the reference barometer of risk appetite in the eyes of fund managers, contracted by 0.46% while preserving the threshold of 5,000 points.

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 $1.0720. The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $83.70.

On the agenda this Friday, to follow in priority the PCE US prices at 2:30 p.m. Note that Fitch and Moody’s are expected to give their verdict on French debt today.

KEY GRAPHIC ELEMENTS

Now is the time to take a breather from the lessons. The CAC index has traced, in contact with the upper Bollinger band, two candles where the low points, the opening level and the closing level merge. And this before starting a slow decline towards the lower part of an ascending channel (in black) on the daily chart. The session of Tuesday April 2, by the volumes, the length of the red body of the corresponding candle, reinforced the 8,220 points as a difficult level to cross.

Then a major technical event occurred, namely the breaking of the gap, the highly symbolic threshold of 8,000 points. The latter, however, does not appear as a scar on the index in the sense that it was filled in from the following session.

We are in the heart of a deep, legitimate breath on the flagship tricolor index.

Two bearish targets present themselves: the bullish gap of February 22, the lower limit of which is worth 7,821 points, then the intermediate support at 7,700 points. Until then, the occasional formation of sharp downward acceleration in prices is not excluded, before remobilization of the buying camp.

FORECAST

Considering the key graphical 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 below resistance at 8120.00 points.

Hourly graph

Daily Data Chart