CAC 40: groggy but not ko

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Even if we cannot speak at this stage of abdication, formally, in the absence of extreme violence releases during the session, we are not far from talking about Krachsince D. Trump announced his famous list of customs from customs against his commercial “partners”.

Recall that in the case of the European Union, this surcharge is 20%. In response, Brussels could lead the offensive by focusing on taxation of digital services. In the meantime, the ambassadors of the Member States have met in an emergency. According to the White House, around fifty countries have engaged in negotiations with Washington.

“Europe plans to announce retaliatory measures soon and China has already reacted with 34% increase in its customs duties on American imports, enough to maintain climbing,” commented Natixis analysts. “The new customs duties announced by Donald Trump Wednesday evening are particularly punitive for China, which was inflicted additional rights of 34%.”

The CAC 40 finished the session on Monday, of intense volatility, down 4.78%, of the unheard of since the Russian invasion in Ukraine. For its part, the German flagship index, the Dax30, plunged 4.13%, returning below the symbolic threshold of the 20,000 points.

The CAC is even ironed in the session surreptitiously in the green, thanks to press information very quickly denied by the White House. The American channel CNBC said that the economic adviser of the White House Kevin Hassett assured that Donald Trump envisaged a 90 -day break in the application of customs duties for all countries with the exception of China.

Beijing immediately retaliated, as we saw. For its part, the European Union will impose customs duties in the United States on April 15 and then on May 15 a first wave of European customs duties on imports from the United States will come into force on April 15 in response to American surcharge on steel and aluminum, before a second wave on May 15, announced Monday the European Commerce Commissioner, Maros Sefcovic.

He added that the European Union proposed in the United States a reciprocal abolition of customs duties on the automobile and all industrial goods. Reciprocal customs duties announced last Wednesday by US President Donald Trump affects 380 billion euros in European exports to the United States, he said.

“We want this commercial de-escalation,” said Laurent Saint-Martin, Minister responsible for foreign trade, after the meeting with his EU counterparts in Luxembourg. The European response to the commercial offensive launched by Donald Trump can be “extremely aggressive,” warned the Minister of Foreign Trade Laurent Saint-Martin, before this meeting.

“We must not exclude any options on goods, on (American) services and open the European toolbox which is very complete, which can be extremely aggressive also in return,” he said. The Minister mentioned “the anti-coercion instrument”, which would notably allow the freezing of access to European public contracts or the blocking of investments.

“The United States will be struck much harder than its main trade partners. Customs duties should cost the United States for about 1.5 points of percentage of GDP by the end of the year, compared to 0.5 points for China and the EU. We now plan that the Fed will reduce its rates three times this year, to 3.5-3.75 %. We are also planning a third drop in BCE rates, 1.75 %”, can be read in a note from Paolo Zanghieri, senior Economist at Generali Investments

In the statistical chapter, we will note the collapse of the “Fentix”, a confidence barometer of investors in the euro zone, in the immediate vicinity of the -20 points. The only German component melts at -36.3 points. In the survey, published this morning, it can be read that American economic expectations have fallen at their lowest level since October 2008, while the price shock has fueled the fears of a global recession. What are also weighing on the Euro, which is more a barometer of the risk of the risk in the financial markets, and explain the early entry into consolidation of the pair of currencies.

In terms of values, renowned industrial values, such as Alstom (-6.25%), Airbus (-6.88%), saffron (-7.79%) or Air Liquide (-7.27%) suffered particularly intense clearances.

On the other side of the Atlantic, the main shares on shares ended in dispersed order, the Dow Jones losing 0.91% and the Nasdaq Composite grapping 0.10%. The S & P500, a reference barometer of appetite for the risk in the eyes of fund managers, preserved the 5,000 symbolic points (-0.23% to 5,062 points).

A point on the other asset classes at risk: around 8:00 am this morning on the exchange market, the single currency was treated at a level close to $ 1,0980. The barrel of WTI, one of the barometers of appetite for the risk on the financial markets, was exchanged around $ 61.10. THE Treasuries 10 Yearsyield of federal sovereign bonds due to 10 years, was negotiated slightly above 4.17%. As for the Vix, it was worth 46.98 at the last fence of the S&P500.

At the macroeconomic agenda this Tuesday, to follow in priority the French trade balance at 8:45 am, and the NFIB of the health of small American companies at 12:00.

Key graphics elements

The technical framework is upset, with a break in the psychological pivot threshold of the 8,000 points at the end of the week 13. Rupture which was followed by intense clearances, in powerful volumes. The GAP of January 16 is now fully filled, without any reaction from the courses. Worse, a crossing part (7,552 – 7,585 points). In two sessions, Thursday 03 and Friday 04 April, the flagship index lost nearly 520 points, and switched to the red for its assessment since 01/01. Monday April 07, once again showed the extreme psychological tension of a market at the heart of a wave of intense clearances. Abdication is close.

FORECAST

In view of the key graphic factors that we have mentioned, our opinion is negative on the CAC 40 index in the short term.

This downward scenario is valid as long as the CAC 40 rating index below resistance at 7465.00 points.

Hourly data graphics

Daily data graphics