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It was not won. Last week, marked by two consecutive public holidays – non-working on the Paris Stock Exchange but conducive to building bridges in the trading rooms – was the scene of a small “rally”, encouraged by the monetary environment. Firstly, with a scenario of two declines in Fed Funds over the year, which is no longer formally ruled out. Secondly, by the Bank of England, which showed itself willing on Thursday to open the door to a first rate cut in the coming months. Enough to further mark the path of the ECB, for the start of a rate cut at the end of the Governing Council next month.
Over the whole week, in mechanically limited volumes, the flagship French index will have gained 3.29%, and formally recorded new zeniths in session data on Friday at 8,259 points.
As a reminder, the British central bank has kept its rates unchanged. However, the institution is clearly heading towards a decline in the coming months. “With the progress made in ensuring that inflation remains around 2% (…) it is likely that we will need to lower rates in the coming quarters and make monetary policy less restrictive, perhaps more than expected by the market,” Bank of England Governor Andrew Bailey said at a press conference, according to comments reported by AFP.
In terms of statistics on Friday, the American consumer confidence index (U-Mich) stood at 67.4 points in preliminary data, well below expectations. Enough to participate further in a welcome relaxation of the American 10 years.
On the value side, Teleperformance gained 3.80%, riding on an analyst recommendation, just like Legrand (+2.84%). Eramet (+5.27%) took first place in the closing daily ranking in compartment A of the rating.
On the other side of the Atlantic, little difference to report at the close for the main stock indices, namely the Dow Jones (+0.32%) or the Nasdaq Composite (-0.03% at 16,340 points). The S&P500, the benchmark barometer of risk appetite, is now more than 200 points above the symbolic bar of 5,000.
An update on other risky asset classes: around 8 a.m. this morning on the foreign exchange market, the single currency was trading at a level close to $1.0770. The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $77.80.
On the agenda this Monday, to follow the conclusions of the Eurogroup (meeting of Finance Ministers of the member countries of the Euro Zone).
KEY GRAPHIC ELEMENTS
The resistance level of 8,120 points gave way on Thursday in insignificant volumes due to the absence of many operators. However, in the very short term, the new working framework is between these 8,120 points, and the absolute peaks close to 8,220 points, i.e. a thin band of around a hundred points. All taking place at the heart of an ascending channel.
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 crossing 8220.00 points would revive the buying tension. While a break of 8120.00 points would restart the selling pressure.
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