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Paris (AFP) – The Paris Stock Exchange rebounded 1.59% on Wednesday, far from making up for the losses of the previous two days, but supported by hope for talks between Ukraine and Russia and the bullish trend on Wall Street.
The CAC 40 star index gained 101.53 points to 6,498.02 points following losing more than 5% in two days.
“The market is very nervous and hesitant”, observes Florian Allain, equity manager at Mandarine Gestion, stressing that the trend is strongly inspired by the evolution of the American market.
Russia continues Wednesday its offensive on the Ukrainian cities, in particular on Kharkiv with the dispatch of airborne troops and bombardments, while evoking a resumption of the talks with a Ukrainian delegation.
The sanctions taken by the West are confirmed: the twenty-seven States of the European Union have excluded seven Russian banks from the Swift international financial system, while sparing Sberbank and Gazprombank, two establishments linked to hydrocarbons, because of the heavy dependence on several European states to Russian gas.
“Commodities are experiencing dizzying increases, this will have an impact on businesses and consumption”, continues Mr. Allain, but given the various market data, he explains that the surge in commodity prices is perceived as very temporary.
“The question is what to do with the barrels of oil that Russia will put on the market in the next two weeks. Can we pay for them?”, he asks, “and above all the question of the reputation arises” for companies and states that would buy Russian oil.
Oil prices rose to levels not seen since 2013, topping $110 a barrel, and European natural gas hit a new all-time high.
In the short term, the explosion in energy prices will reinforce inflation. In February, it broke a new record in the euro zone, standing at 5.8% over one year.
The situation does not facilitate the task of the central banks, which had begun to reduce their monetary support to the economy to stem the rise in prices.
The consequences of the war in Ukraine for the American economy are “very uncertain”, for his part estimated Jerome Powell, the president of the American central bank. He said he was “inclined to propose” an interest rate hike of a quarter of a percentage point (0.25%) at the next meeting of the monetary committee in mid-March.
TotalEnergies bounces back
Galvanized by soaring oil prices, TotalEnergies shares rebounded 8.17% to 47.98 euros, erasing much of their losses of the previous two days. With the overall rise in raw materials, ArcelorMittal was also sought following and gained 2.96% to 29.21 euros.
Elior loses his boss
The Elior share (-2.37% to 3.79 euros) was shaken by the surprise departure of the general manager of the collective catering group Philippe Guillemot, which weakens the company, according to analysts, in a sector very tested by the health crisis and the generalization of teleworking.
© 2022 AFP
