The Paris stock exchange, which fell sharply this morning, then erased most of its losses thanks to the publication, in the early afternoon, of the consumer price index in the United States, which shows a surprising slowdown in inflation, net of elements. birds, in the month of March. Consumer prices rose 1.2% in one month, as expected, and 8.5% in one year, versus 8.4% expected. In the “core” data (excluding food and energy) the increase is 0.3%, compared to 0.5% in February and an estimated 0.5%. On the bond market, the US 10-year yield fell by 7 basis points to just under 2.71% at the close of the European stock market indices, after hitting 2.83% this morning, for the first time since the end. of 2018.
As Wall Street rebounds from yesterday’s pullback, the 40escaping the red wave the day before, investors who said they were relieved by Emmanuel Macron’s advance after the first round of the French presidential elections, closed today down 0.28%, at 6,537.41 points, far from the low of the day (-2%, at 6,424.97 points).
“The big news in the March statistic is that underlying price pressures seem to finally easereports Andrew Hunter of Capital Economics, for which the March price increase will peak. “ He adds, however, that these figures shouldn’t change the Fed’s plans to raise interest rates by 50 basis points, but “They reinforce our sense that, after being slow to realize that the initial price hike was not transitory, Fed officials are now a little too pessimistic about how quickly it will fall. “
Hammer blow on the economy
The recent rise in inflation has prompted more accommodative members of the Fed’s Monetary Policy Committee (FOMC) to believe that swift and vigorous action was needed to counter the rise in prices. Long considered one of the most “Colombian” within the FOMC, Charles Evans, chairman of the Chicago Fed, believed that accelerating the pace of rate hikes should be discussed to fight inflation.
Fed Governor Christopher Waller meanwhile said the central bank is doing everything it can to prevent monetary tightening from stifling growth. Indeed, he described rate hikes as a tool for “brute force” can have the effect of a ” hammer “ causing “collateral damages” on the economy. For now, the market expects hikes in the Federal Funds rate of 50 basis points during the next two meetings of the Fed’s monetary policy committee.
According to Bank of America Securities’ latest monthly survey of fund managers, investor optimism about global economic growth is at an all-time low, while fear of high inflation combined with stagnating activity had never been so high since August 2008.
Beginning of the easing of the lockdown in Shanghai
Oil prices are on the rise again on Tuesday, with the price of Brent rising 7% to $ 105 a barrel, following allegations that Russian forces have used chemical weapons against the besieged city of Mariupol and also doped by the Chinese decision yesterday to facilitate confinement in some areas of the city of Shanghai.
On this latest information, the shares of luxury companies LVMH And Hermes end up on Cac 40. LVMH will publish its first quarter turnover immediately after the stock market close.
In reverse, General Company, sought after yesterday following the bank’s decision to withdraw from Russia, closed on Tuesday down nearly 2%. The European banking sector has generally been under pressure on the stock market today, German bank And Commerzbank closing on declines higher than 8%. A mystery investor sold tens of millions of shares representing over 5% of the capital of the two German banks for a total amount estimated at € 1.75 billion.
The biggest drop of the Cac 40, Sanofì (-2.8%) took some profit after its record yesterday.
The tester Eurofins Scientific also finished at the bottom of the ranking while, in the same sector, bioMerieux it lost nearly 6% in response to the publication of a quarterly turnover of 837 million euros “Organic decline of 4.5%, we see within the financial analysis company Midcap Partners, slightly below consensus expectations (€ 840.5 million) on a demanding comparative basis (+ 16.5%) “obviously reflecting the impact of the slowdown in demand for Covid tests.