CAC 40: Consumer prices, justice of the peace of equity indices

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The producer price indices (PPI) across the Atlantic disappointed on Tuesday with their strength (+0.5% monthly), and it is with all the more anxiety that operators will follow the publication of the consumer price indices (CPI) across the Atlantic.

IPCs which will “act as a justice of the peace” for the markets, according to the strategists at Ostrum AM who see a return of volatility in the wake of this publication. Volatility which will be measured by the deviation from the consensus. Excluding food and energy, volatile elements, prices are expected to increase monthly by 0.3%. Verdict at 2:30 p.m.

The CAC 40 index remained on “standby” on Tuesday in the immediate vicinity of its absolute peaks, managing to gain 0.20% to 8,225 points, at the heart of a broader consolidation figure.

In terms of values ​​on Tuesday in Paris, if we had to choose only one in this wait-and-see market, it would be Société Générale (+3.79% to 27.255 euros). The La Défense bank seems to be buoyed by the declarations of the President of the Republic, Emmanuel Macron. Monday evening, the tenant of the Elysée responded to a question from Bloomberg on a potential takeover of a French bank by a European counterpart, indicating that he was open to such a hypothesis. Bloomberg’s question took as an example a takeover of Société Générale by Santander. But other players, such as the Italian Unicredit, are regularly cited.

Furthermore, Veolia gained 2.1% driven by first quarter results above expectations thanks to the synergies extracted from the integration of Suez.

On the other side of the Atlantic, the main equity indices closed once again in the green: +0.32% for the Dow Jones and +0.75% for the Composite. The S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, increased by 0.48% to nearly 250 points, now above the symbolic threshold 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 Wednesday, to follow as a priority the consumer price indices across the Atlantic at 2:30 p.m.

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.

Hourly graph

Daily Data Chart