(BFM Stock Exchange) – Beyond the vertiginous variations of the equity markets proper, several phenomena show that traditional benchmarks of investors are changing, sometimes radically. Volatility increases, the clues make the big gap in a few minutes, the dollar becomes an asset to flee, the American obligations collapse and the gold disappoints.

To say that Donald Trump caused a shock wave on the markets by drawing the weapon of reciprocal customs duties is euphemism. Since the announcement of these customs surcharges applied to all trade partners, the markets have suffered.

The CAC 40 finished further down 3.3% on Wednesday and accused a 12.5% ​​drop in five sessions.

It is hardly better on the side of Wall Street where the S&P 500 suffered very close losses on Wednesday.

At least until Donald Trump announces the suspension for 90 days of customs duties (except for China). Wall Street, after this announcement, returned to the increase in spectacular way.

This turnaround should also allow the CAC 40 to rebound strongly this Thursday, the index being expected in very high increase (more than 7%) at the opening, depending on the contracts.

However, this will not forget the terrible preceding sessions. Recall that the trade war that arose from the American offensive raises fears of a global recession. This frightened investors and explains the stock market panic that was observed in the previous days.

The market behavior was “dramatic”, remarks Goldman Sachs. But beyond the fall in global scholarships per se, several signals show that the market loses its bearings, and is perhaps confused. A change of software also takes place on several assets. Overview.

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> Indices that go from 4% to -2.2% in a very short time

The fall in the markets is one thing. The scale of variations during the same session is another. On Monday, the CAC 40 certainly plunged by 4.8% but it had dropped almost 8%.

It’s even more impressive on the side of Wall Street. On Monday, the Nasdaq lost 4% at the start of the session but finished in the green. On Tuesday, the American index, on the contrary, opened up more than 4% before falling by 2.2% at the end, at 10 p.m. According to the research company Bespoke Investment, such a chain has never occurred in the history of Nasdaq.

Wednesday evening, the S&P 500 took more than 7% and the Nasdaq more than 10% in the wake of the turnaround of Donald Trump, while the two American indices were close to the previously balance. Dizzying take -off as we have very rarely seen on the market.

As Xavier Chapard, from LBPAM, the VIX, “the index of fear of Wall Street” underlines, which measures the volatility of the market, exceeds 50 and even signed a peak at 58 on Wednesday. These levels had not been achieved since the start of the health crisis in February-March 2020.

A particularly striking episode occurred on Monday: the equity markets erased their heavy losses in just a few minutes, evolving even in the green, before returning so dry to their starting point. Press information on a potential postponement of customs duties had carried the market, before being almost immediately qualified as “fake news” by the White House.

“This was a clear indication that the markets are here very sensitive to any change in policy, since even a press title with little substance has been able to cause a huge reaction of the market,” said Deutsche Bank.

“The markets may remain volatile in the coming weeks, because the attention of investors is traveling between the changing interpretations of the Trump administration objectives”, judges UBS in a note published this Wednesday.

> American treasury bills are in free fall

When the equity markets collapse, in particular in the event of recession, investors turn to certain refuge values, in particular obligations. Simply because for developed countries, the risk of bankruptcy does not (normally) do not exist. During previous crises, investors jostled to buy states debt, including American treasury bills.

This is, of course, what happened on April 3 and 4, in the wake of Donald Trump’s announcements. The yield of the American debt title at 10 years old fell, falling close to 4%. Recall that the prices of bonds, by construction, evolve in the opposite direction of the yields required by investors. In other words, American treasury bills increased on April 3 and 4.

But everything has brutally changed since the start of this week. The American rate at 10 years first continued to retreat, playing around 3.8% on Monday, before, the same day, to jump to 4.17%. The Rontada continued and not just a little. Wednesday after the closing of European scholarships, the yield was 4.36% up 6 base points (0.06 percentage points) compared to the day before, which constitutes a significant increase in this market.

American bonds no longer attract investors. On Tuesday, an auction-that is to say to simplify an auction-of American debt at three years was disappointing. The coverage ratio, an investor demand indicator for American paper, fell to a six -month lower.

“Customers asked us if the request was falling back to the side of foreign or national investors. Although we did not know the response in real time, the global macroeconomic landscape suggests that it could be both,” said Bank of America in a note published on Wednesday.

The American bank believes that a “perfect storm” presents itself to investors on American debt with both a risk of inflation due to customs duties but also a risk of worsening the public deficit.

Paul Diggle, chief economist of the Aberdeen asset manager, cites four reasons for the drop in American obligations. He first mentions uncertainty about American economic policy. The economist also judges that American assets (stocks, bonds, dollar) “can become structurally less attractive to invest in the long term, with customs duties reducing long -term growth potential”. The specialist also evokes the risk that the American federal reserve does not reduce its rates as much as expected by the market.

Finally “Asian investors in particular seem to sell American assets,” he suggests.

“In the extreme, this could turn into a ‘dumping’ (a massive sale, editor’s note) of treasury bills by China, as it has long been speculated. However, such a movement would lead to an appreciation of Chinese currency, which does not seem to be the preference of political decision-makers for the moment,” he said.

In any case, Bloomberg reported that investors have found alternatives to American obligations to protect their portfolio, the agency citing European and Japanese debt titles.

> The dollar suffering from a risk of crisis of confidence

We have more widely mentioned this point in a recent article. Like American obligations, the dollar is normally acclaimed during the stock market storm. But no, the American motto has been abused by major international currencies since the announcement of customs surcharge.

The risks on the American situation play. Reciprocal customs duties will weaken “the American economy” and “consequently, it is more likely that the federal reserve should soften its monetary policy in a more energetic way, which will weaken essential support for money,” said UBS.

But other factors are at work. George Saravelos believes that the way the United States has calculated the reciprocal customs duties applied to other countries – roughly a college level formula – “raises serious concerns about the credibility of the (American) economic policy” manhandling by the same the dollar.

The Deutsche Bank strategist even fears “a risk of crisis of confidence” on the dollar, while the status of refuge value of the “crumbling” currency.

For over 10 years, investor funds have moved around the world to reach the United States. George Saravelos, fears that a violent return of a pendulum will take place and that the investment flows on the markets flee the United States to join, for example, Europe. This would obviously undermine the dollar, since such movements come back to sell financial products in dollar to buy them in other currencies.

The drop in the dollar combined with other factors described above does not bother anything good. The fall in shares and the dollar and the increase in yields are a pernicious combination. In any other country, we would speak of a sovereign crisis, “even writes Paul Diggle.

“Selling the company ‘United States and Cie’ is becoming the market thing”, judges Stephen Innes of Spi Am.

> Gold has suffered

This last point deserves to be nuanced. In reality, gold above all crossed an air hole, more than undergoing a real revolution. Besides, the ounce resumed around 2% this Wednesday after having already climbed more than 3% the day before, nearly 3,050 dollars. But its level remains lower than that preceding Trump’s announcements on customs duties (3.166 dollars).

For a person who does not follow day -to -day markets, it may seem surprising, insofar as gold is supposed to be the refuge value par excellence. The precious metal still lost almost 5%, accumulated, last Thursday and Friday.

It seems that gold has suffered simple technical decisions. “This drop is largely due to the fact that portfolio managers have been forced to liquidate their gold positions to respond to margin calls on their position positions,” said Ricardo Evangelista of Activtrades.

To simplify, “margins” occur in certain markets, when a financial intermediary, such as a broker, asks an investor to provide funds to cover a losing position. Magnium calls are thus alert signals which arrive in particular in the event of brutal movements on the markets. Which has been the case in recent days.

“We think” that the movement of decrease on gold “probably reflects, on the one hand, the liquidation of long positions (buyer, editor’s note) on gold to cover margin calls on shares following the generalized sale of stock markets and, on the other hand, the potential rotation of gold investors towards alternative assets now that the initial uncertainty linked to reciprocal rates is Resolved “, abounds Goldman Sachs.

“Consequently, this sale (gold, editor’s note) seems to be more motivated by technical and sentimental factors than fundamental. The main factors that supported gold remain unchanged,” concludes Daniela Sabin Hathorn from Capital.com.

The latter cites, for example, the continuous demand for central banks for gold, in particular central banks of emerging countries, or “continuous concerns concerning global growth”.

“The remaining uncertainty of the dominant theme of the financial markets and the political options of the federal reserve being increasingly limited, the precious metal could have an additional potential”, judges Ricardo Evangelista.