CAC 40: The ECB in the pricing fog

(BFM Stock Exchange) – This article, with free access, is produced by the research team in BFM Stock Exchange analysis and market strategy. To not miss any opportunity, consult all of the analyzes and discover our portfolios by accessing our privilege space.

With the welcome support of Stmicroelectronics (+11.13%) and Airbus (+2.25%), the CAC 40 managed to grab 0.25%, in an always uncomfortable atmosphere, the vagueness still reigning over the definitive customs duties that the United States will inflic to the different economic powers with which they trade.

The pan-European aeronautical manufacturer was propelled by a mega-contract potential in China and by deliveries in May less bad than feared, according to information from Reuters.

The semiconductors have evolved clearly, Stmicroelectronics jumped more than 11%, and fence at the top of the CAC 40 when Soitec resumed 5.8%. A financial intermediary gives two reasons for the rise in the sector. First, the management of the American competitor Onsemi spoke of one of the signs of resumption of demand. Then, Stmicroelectronics participated in a conference organized by Exane BNP Paribas during which the group also sent a message of trust, anticipating a cyclical recovery in the coming quarters.

On the customs aspect, “the equity markets give the impression of being only punctuated by commercial declarations, ignoring the potential economic consequences of this trade war”, notes Alexandre Baradez, analyst at IG France. The market specialist evokes “a strange atmosphere”.

The operators, who were able to read Tuesday from a target target on the new job offers (JOLTS), had a relative disappointment with the Cabinet in HR ADP which highlighted post creations of the order of only 37,000, significantly in expectations. Verdict at the end of the week with the NFP (Non Farm Payrolls) report. In addition, the activity of services in the United States, has been against all expectations contracted at 49.9 points in May against 52 expected by consensus, and after 51.6 points in April. Note that a score of less than 50 points means a contraction of the sector considered.

On the other side of the Atlantic, the main shares on shares ended in dispersed order, the Dow Jones contracting by 0.22% and the Nasdaq Composite grapping 0.32%. The S & P500, a reference barometer of the appetite for the risk in the eyes of fund managers, played the averages by finishing at balance at 30 points from the 6,000 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 $ 1,1420. The barrel of WTI, one of the barometers of appetite for the risk on the financial markets, was exchanged around $ 62.20. THE Treasuries 10 Yearsyield of federal sovereign bonds due to 10 years, was negotiated slightly above 4.37%. As for the Vix, it was worth 17.60 at the last fence of the S&P500.

At the macroeconomic agenda this Thursday, to follow the decision of the BCE monetary policy as a priority at 2:15 p.m. and the weekly registrations for unemployment benefits at 2:30 p.m.

In the press conference following the rate decision, at 2:45 p.m., C Lagarde will not fail to comment on the German recovery plan, in the form of tax support for companies in the amount of 46 billion euros over five years.

Key graphics elements

The gradual cap under the 7,900 points has suddenly turned into intense volatility. In one session Friday, May 23, the Parisian flagship index broke the Dynamics of the spring rally by breaking the mobile average at 20 days (in dark blue), the difference compared to the mobile average at 50 days (in orange) has taken up strongly.

The 7,900 points are reinforced in their status of graphic resistance, even though the dynamics of the relative force index invite caution. Indeed the RSI (relative Strenght Index) has adopted a persistent lower bias since May 13.

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 7900.00 points.

Hourly data graphics

Daily data graphics