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Paris (AFP) – The Paris Stock Exchange closed sharply in the red on Friday, leaving behind it a bad year for the financial markets which have cashed in on the aggressive actions of central banks to curb inflation.
The star CAC 40 index fell 1.52% to 6,473.76 points, thus dropping below 6,500 points. The Parisian place lost 9.50% compared to December 31, 2021. It thus recorded its worst year since 2018, where it had plunged by more than 10%.
However, the rating has held up better than other financial markets, such as Frankfurt, where the Dax has lost more than 12% since the start of the year, or Wall Street, where the S&P 500, benchmark index, posted a drop close to 20% a few hours before the last close of 2022.
Overall, the MCSI World equity index has lost nearly 20% since Jan. 1, its worst performance since 2008.
Finally, following the series of shocks which put the markets to the test and regularly led to strong variations in the indices, “it’s quite unexpected for the end of the year”, estimates Pierre Bismuth, managing director and head of management at Myria AM .
The fall in the markets in 2022 was mainly influenced “by the central banks which decided to tackle inflation whatever the consequences on the economy”, recalls for his part Nicolas Budin, head of management shares to Myria AM.
The global economy decelerated in 2022 as central banks aggressively raised rates to quell rising prices.
“The evolution of the rates will occupy us part of 2023”, warns Mr. Bismuth.
Many analysts believe that an economic recession, and therefore a decline in profits, is inevitable in 2023, which might cause stock indices to continue their decline.
Investors are also asking questions regarding the evolution of the health situation in China and geopolitics around the war in Ukraine.
At sector level, energy stood out this year: TotalEnergies, which represents 10% of the CAC 40, is up more than 31%, boosted by soaring oil prices.
Thales (+59.49%) signs the strongest rise in the CAC 40 since the start of the year.
On the other hand, technology stocks, sensitive to interest rates, drank the cup, like Dassault Systèmes (-35.97%), Capgemini (-27.63%) or Worldline (-25.46% ).
© 2022 AFP
