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The zeniths of the CAC 40, namely its absolute peaks, acted as short-term graphic resistance on Monday, the flagship Parisian index returning 0.12% to 8,209 points. A very limited decline compared to the progress made last week, in a monetary environment more favorable to investors. The Bank of England has paved the way for the ECB for a first rate cut this summer, and on the other side of the Atlantic, a scenario of two cuts in Fed Funds by the end of the The year is no longer ruled out.
Sanofi (+2.36%), and the automotive sector will have allowed the CAC 40 to limit its decline in the first session of the week. The pharmaceutical group and its partner Regeneron announced that the American health authority had granted priority review to Dupixent for the treatment of chronic rhinosinusitis with nasal polyposis in adolescents. As for Renault (+2.17%) and Stellantis (+3.70%), just like the equipment manufacturer Forvia, once again showed volatility, on the rise this time.
On the macroeconomic agenda on Monday, there is nothing substantial to get your teeth into. We will have to wait until 2:30 p.m. this afternoon for the agenda to thicken, notably with the producer price indices across the Atlantic. And especially tomorrow with inflation figures.
“The markets are awaiting the US inflation figure for April published on Wednesday. This will be the first test after the reassuring meeting of the Fed (American Federal Reserve, Editor’s note) at the beginning of the month, when Powell indicated that the next change in the key rate should always be downward, even if the first reduction should occur later than they thought until then,” explains Xavier Chapard of LBPAM.
On the other side of the Atlantic, the main equity indices ended Monday’s session in mixed order, with the Dow Jones contracting 0.21% and the Nasdaq Composite gaining 0.29%. The S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, ended in balance, more than 220 points above the symbolic bar of 5,000 points.
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 Tuesday, to follow in priority at 11:00 a.m. the ZEX index of confidence in the German economy, and at 2:30 p.m. the consumer price indices in the United States. Excluding food and energy, volatile elements, prices are expected to increase monthly by 0.3%.
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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