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Although it narrowly avoided the combination of bearish harami candles, the CAC 40 fell below 8,260 points, a technical level corresponding to both historical highs and a resistance force. The flagship French index lost 0.63% to 8,206 points, weighed down by L’Oréal, whose quarterly copy did not convince. In the third quarter, the company announced Tuesday evening that it had achieved like-for-like growth of 4.2%, compared to a consensus of 4.7%, according to Royal Bank of Canada.
Another big name in luxury, Hermès, published its quarterly copy. And despite growth of almost 10%, the stock lost 2.27%. The group’s most important division, namely “leather goods and saddlery” (a little less than 45% of sales), disappointed slightly, with growth of 13.3% on a like-for-like basis. According to Royal Bank of Canada, the consensus was for a rate of 14%.
Geopolitical uncertainties hung over the entire session. American President Donald Trump said Tuesday evening that he did not want a meeting with Russian President Vladimir Putin if this meeting was of “no use”. “I don’t want to waste time so we’ll see what happens,” he proclaimed to the press, according to comments relayed by Agence France Presse (AFP).
On the other side of the Atlantic, the main equity indices ended Wednesday’s session in the red, like the Dow Jones (-0.71%) and the Nasdaq Composite (-0.93%). The S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, contracted by 0.53% to 6,699 points.
An update on other risky asset classes: around 8:00 this morning
> On the foreign exchange market the single currency was trading at a level close to $1.1590.
> The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $60.20.
> THE Treasuries 10 years, yield on federal sovereign bonds maturing in 10 years, were trading slightly above the 3.95%.
> As for the VIX, it was worth 18.60 at the last close of the S&P500.
On the macroeconomic agenda this Thursday, to follow as a priority the barometer indicators of PMI activity (services and industry) for the Euro Zone, in 1st estimate for the current month, at 10:00 a.m.
KEY GRAPHIC ELEMENTS
The 8,260 points formally constitute a resistance, which would only become support in the event of a large, rapid crossing in powerful volumes, all in a large sectoral federation. The last two sessions of the week will therefore be essential on a technical level.
FORECAST
Considering the key graphical factors that we have mentioned, our opinion is negative on the CAC 40 index in the short term.
This bearish scenario is valid as long as the CAC 40 index is below resistance at 8260.00 points.
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