CAC 40: palpable nervousness under 7,900 points

(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.

Transition session yesterday at the Paris Stock Exchange. In mechanically shy volumes due to Monday’s holiday nature (Pentecost, not unemployed for Euronext Paris), the CAC 40 contracted 0.17% at 7,791 points, in a desert on the macroeconomic publications front. The operators digested the publication of the solid federal monthly report on Friday employment.

Here are the main lessons as a reminder: the unemployment rate first of all, remains stable at 4.2% of the active population. Average time wages are growing a little more than anticipated (+0.4%), and above all, job creations in the private sector, at 139,000, above expectations, completes a solid portrait of employment.

What put into perspective the somewhat alarmist publication of the ADP cabinet a little earlier in the week. And above all enough to bring down the pressure on Jerome Powell’s shoulders, which has been undergoing presidential pressure since the start of the mandate of Trump to soften the rates.

The week that opens is under the sign of inflation, on the statistical side, with consumer prices across the Atlantic Wednesday (ICC).

The operators remain affected by customs issues. And therefore on the lookout for the slightest development in the trade war led by Trump against the rest of the world. With the hope that the fragile commercial truce between the two countries will be extended. “The Wall Street Journal reports that President Trump gave to the Secretary of the Treasury (Scott) are weighing the power to negotiate the abolition of technological products export controls to China as part of commercial negotiations,” noted analysts of the American stock market letter Briefing.com.

On the French values ​​side, Rémy Cointreau took 5% and Pernod Ricard 3.2%. These two titles were able to react to press information published on Friday evening. According to Reuters, the Chinese Foreign Minister said that France and China had decided to resolve their business disputes over Cognac, even if no indication of an agreement has been given. China is considering implementing permanently next month a customs surcharge of up to 39% on this type of liquor. Analyst at Oddo BHF, Pierre Tegner had indicated last year that Cognac in China represented around 25% of income from Rémy Cointreau and 8% at 9% of those of Pernod Ricard.

On the other side of the Atlantic, the main shares on shares varied little on Monday, the Dow Jones ending up in balance and the Nasdaq composite grapping 0.31%. The S & P500, a reference barometer of appetite for the risk in the eyes of fund managers, nibbled 6 points, at 6,005 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 $ 1,1400. The barrel of WTI, one of the barometers of appetite for the risk on the financial markets, was exchanged around $ 64.85. THE Treasuries 10 Yearsyield of federal sovereign bonds due to 10 years, was negotiated slightly above 4.48%. As for the Vix, it was worth 17.16 at the last fence of the S&P500.

At the macroeconomic agenda this Tuesday, to follow in priority the “feelix” of consumer confidence in the euro zone at 10:30 am. We will also note a Trump speech, scheduled at 10:30 p.m., on the occasion of the 250th anniversary of the American army in Fort Bragg.

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) Adopt a persistent lowering 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 7810.00 points.

Hourly data graphics

Daily data graphics