CAC 40: A little air before a new reflux

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There was significant volatility, and significant end differences on the Paris Stock Exchange Thursday, a relatively unusual situation during Wall Street closings. The operators were indeed deprived of American stock market benchmarks Thursday, June 19 (Juneteenth – day of commemoration of the end of slavery). The reopening this Friday will provide important lessons, while the market is under pressure from the conflict between Israel and Iran. Donald Trump, through the White House spokesperson, gives himself two weeks during which the possibility of direct American military intervention in Iran could if necessary materialize.

“The direct involvement of the United States would surely exacerbate tensions in the region, at least in the short term. This naturally came to affect risk taking on the market,” comments Sebastian Paris Horvitz of LBPAM.

Christopher Dembik, investment strategy advisor at Pictet AM wants to be rather reassuring:

“For the markets, the question is what magnitude will be the American commitment in the conflict between Israel and Iran. Hence the feverishness observed [mercredi]. For the moment, this is limited to the provision of strategic information to the Israeli government and the transfer of military aircraft, including bombers, in the Basic of the Gulf and especially in Diego Garcia. There is more fear than harm, so far. Many investors fear the blocking of the Strait of Ormuz. It doesn’t seem credible. Revolutionary guards have apparently tried to blur the GPS and GNSS signals (satellite navigation) in the area, with a very mixed success. Only two merchant ships have encountered difficulties. The circulation is fluid and normal, as satellite images prove.

In any case, the CAC lost 1.34% Thursday, at 7,553 points, by closing exactly on the low session points. The pre -opening data this Friday suggests a rebound franc in the first part of the session.

On the side of the values, Totalenergies ends at the head of the CAC 40, carried by the rise in oil prices. The August contract on the Brent de Mer of the North advances 2.20% to $ 78.39 a barrel while that of July on the WTI listed in New York takes 2.23% at 75.14 Dollars per barrel. On the other side of the spectrum, TP (ex-Teleperformance) lost 4.1%, the day after a drop of 13.6%, the new strategy presented by the group as part of an investor day organized in New York hardly reassured the scholarship. Eutelsat rebounded by 14.5%. The satellite operator won a contract with a maximum amount of 1 billion euros over 10 years from the Ministry of Defense. Oddo BHF also went from “underperformance” to “neutral” on the title.

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 $ 1,1520. The barrel of WTI, one of the barometers of appetite for the risk on the financial markets, was exchanged around $ 73.50. 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 22.20 at the last fence of the S&P500.

At the macroeconomic agenda this Friday, to follow in priority the manufacturing index of the Fed of Philadelphia (Philly Fed) at 2:30 p.m.

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. The tricolor flagship index is now in a glaring situation of incapacity for creations of new heights.

First alert Thursday, June 12 with a metal gap in session. Second the next day with a new gap, filled in the session too. The short -term configuration is gradually weakened.

FORECAST

In view of the key graphic 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 a crossing of the 7700.00 points would revive the tension to the purchase. While a break in the 7512.00 points would relaunch the selling pressure.

Hourly data graphics

Daily data graphics