Another feverish session for Cac 40, before the Beige Book of the Fed and the ECB, Market news

We take the same and we start again … Very skeptical, the Paris Stock Exchange narrowly avoids a new session of decline, saved by the development of Wall Street. The Cac 40 ended with a symbolic gain of 0.02%, at 6,105.92 points, in a still narrow trading volume of 2.72 billion euros. Across the Atlantic, the indices are growing, the Dow Jones get 0.79% and the Nasdaq Composite 1%, after aligning with seven consecutive withdrawal sessions, which has not happened since the end of 2016.

Once again, the session took place under the influence of the energy crisis in Europe – Vladimir Putin again threatens to cut the flood gates – questions about global growth – oil sinks below 90 dollars – and questions about the action of central banks to control inflation. In less than 24 hours, operators will be corrected by the fate reserved by the European Central Bank (ECB) for the euro zone. It will make a decision on interest rates at 2:15 pm, then its president, Christine Lagarde, will speak from 2:45 pm. It must avoid any mistake, at the risk of causing a skid in the financial markets. With inflation at a historic high of 9.1% annually in August, and after an initial increase in July, investors are expecting a significant 75 basis point increase in the refinancing rate, which is currently at 0.5% ” The real surprise will be if the ECB does not go ahead with its three quarters of rate hikes on Thursday “said Véronique Riches-Flores, economist and founder of RF Research. The ECB, whose original mandate was to maintain price stability, is far from fulfilling its mission at the moment and finds itself behind the cycle of its money, especially compared to the American Federal Reserve.

The Fed will be in charge on September 21. Accelerating activity in the US service sector in August showed that the world’s largest economy is strong enough to withstand a 75 basis point increase in Fed funds rates. This probability is estimated at 82% according to CME Group calculations based on Fed funds futures contracts, compared to 69% a week ago. To facilitate their analysis, investors will look tonight to the Fed’s Beige Book. This document provides an update on the evolution of business activity in the Fed’s 12 districts. This will serve as a working basis for the next meeting of the institution. In Canada, the central bank recently took the plunge: it raised the key rate by 75 basis points to bring it to a 14-year high. He explained that the cost of borrowing would have to rise further to prevent rising prices.

The last element dampened the stock market trend: the disappointing figures for China’s foreign trade in August, which revived questions about the country’s growth. Exports were weak: +7.1% a year, expressed in dollars, against the increase of 18% in July and 12.5%​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​ Imports, they increased only 0.3%, against 2.3% in July and 1.5% expected by the market. A sign that does not mislead and clearly shows the impact of the measures to prevent the health of the activity: the import of oil decreased by 4.7% since the beginning of the year and the coals by 14.9%.

Big boy for Ubisoft

In front of values, Ubisoft slumped to 17.24%, last in SRD. The announcement of the increase of the Chinese Tencent to 9.99% of the capital of the video game publisher and 49.9% of the shares of the holding company, Guillemot Brothers Limited, makes the file lose its speculative aspect even if it is a nice one very operation. for the Guillemot family.

Within the CAC 40, Total Energy fell 3.7%. On the contrary, On the contrary, Engie led the index, with a gain of 4.93%, following the European Commission’s proposal to cap prices at 200 euros per megawatt hour for electricity produced outside of gas-fired power stations. In Rotterdam, European gas futures contracts fell 7% to 223 euros per megawatt hour after falling 2.5% on Tuesday. At the European level, the Stoxx 600 of “utilities” rose by 2.6%, thus signing the best performance of the sector.

Finally, Saffron gained 1.48% thanks to a note from Goldman Sachs, which included the engine manufacturer in its “conviction list” of European stocks and raised its target price from 134 euros to 150 euros.


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