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Paris (AFP) – The Paris Stock Exchange ended down on Tuesday, prevented from continuing its race ahead in the face of the World Bank’s pessimism regarding global growth in 2023 and the approach of a major meeting on American inflation.
The star CAC 40 index dropped 0.55%, or 38.22 points to 6,869.14 points following returning the day before above 6,900 points for the first time since February 18, 2022, before the Russian invasion of Ukraine.
The ardor that the European markets showed since the beginning of the year seems to calm down to be more in tune with the mood of Wall Street.
“For the moment, the market is absorbing the phenomenon of the rise at the start of the year and is focusing on the end of the week,” Frédéric Rozier, portfolio manager at Mirabaud France, told AFP.
The agenda will fill up at the end of the week with consumer prices for December and weekly jobless claims in the United States.
After a complicated year 2022, the markets have many things to consider: the risks of recession, the level of interest rates and that of inflation, the health risk in China following the end of its zero Covid policy and the geopolitical risk with the war in Ukraine.
“While the avalanche of macroeconomic figures during the first week of the year tended rather to confirm the decline in inflationary pressures on both sides of the Atlantic, which is a positive signal, the path towards normalized inflation is still a long time to be confirmed,” said Thomas Giudici, head of bond management at Auris Gestion.
On Monday, US central bank (Fed) officials reaffirmed their desire to keep interest rates high for some time to stem rising prices, curbing investors’ risk appetite.
The US consumer price index for December, which will be released on Thursday, is this week’s main macroeconomic date.
Analysts expect flat month-on-month and a year-on-year slowdown to 6.5%, which would bode well for equities.
On Tuesday, the World Bank sharply revised its global growth forecast for 2023, which it now anticipates at 1.7% once morest 3% last June, due to persistent inflation, rising rates and the effects of the war in Ukraine. It only expects a moderate global recovery in 2024 (+2.7%).
The trend might worsen further, with a real risk of recession, in the event of a new shock to the economy, whether caused by a resumption of inflation, a new wave of Covid or geopolitical tensions.
During the session on the Paris Stock Exchange, cyclical stocks were subject to profit taking, such as Saint-Gobain (-2.40%), Michelin (-1.80%) and Legrand (-1, 81%).
The action of the global optical giant EssilorLuxottica fell 1.82%, to 172.65 euros, penalized by a note from RBC analysts who believe that the title might experience a year 2023 less solid than 2022 due to the reversal of positive factors.
© 2023 AFP
