CAC40: Below 7000, 1st correction session of the year – 19/01/2023 at 15:09
(CircleFinance.com) – After 11 days of gains in the first 13 sessions of the year, the Paris Stock Exchange corrected rather brutally on Thursday (-1.8%), as doubts about the speed of the central bank’s monetary policy easing resurfaced. banks: ECB (Lagarde) and Fed (several members spoke) sent a message to the markets – from Davos – of determination to fight inflation.
The session looked bleak this morning with Tokyo down -1.5% and the Dow Jones down -1.8%, the Nasdaq down -1.2% and the S&P500 down -1.6% last night.
In Europe, the Euro-Stoxx50 -1.7%, the Frankfurt stock exchange -1.6%, and Paris -1.8% – 6,955 is a red light.
Some strategists believe that markets moved too quickly at the start of the year, when the latest indicators came in to reinforce the preferred scenario of a soft slowdown for the economy.
“Markets are clearly trying to price in a rally before the downside,” said Marcus Poppe, global equity portfolio manager at DWS.
In particular, the professional believes that US equity valuations remain too high, but the future looks a bit brighter in Europe, leading him to overweight European stocks.
“At this stage, we estimate that the impact on the current trend will be limited if there is a consolidation at this 7,085 or 7,140 point valuation level in the CAC,” adds one from Kiplink Finance.
“A reversal of 50-100 points will be absorbed quickly to allow the CAC 40 index to continue its upward course,” the management company warns.
Investors learned a new set of economic statistics Thursday, including the latest figures for the U.S. real estate sector.
The Commerce Department reported that housing starts in the U.S. fell 1.4% last month to 1,382,000 on a year-over-year basis, but were slightly above economists’ expectations.
U.S. housing permits – which are supposed to predetermine future housing starts – fell 1.6% year-on-year to 1,330,000 in December, missing some of the market consensus.
The housing sector, which has been in the red for several months, should remain in a bearish trend as financing opportunities run out.
Another figure of major interest to the Fed: The labor market is unusually buoyant as weekly US jobless claims fell by 15,000 in the week of January 9, down from 205,000 the previous week to 190,000. Department of Labor.
The four-week moving average — considered a better indicator of the underlying trend in the labor market — showed a decline of 6,500 to settle at 206,000.
Finally, given the complete opposite of the poor ‘Empire State’ index published the day before, another surprise, the ‘Philly Fed’ index, on the contrary, shows an increase in activity in the manufacturing industry of the US Northeast: a more limited recovery around -11 economists The index rose to -8.9 after expected -13.7 in December.
This is the seventh time in the past eight months that it has fallen below zero.
The employment sub-index improved markedly, rising from -0.9 to +10.9 on the month, as did the new orders index, which rose but remained in negative territory. , -10.9.
Bond markets are using all of the above as excuses for consolidation: our OATs up +8 points to 2.516%, Bunds up +7.5 points to 2.08%, Italian BTP up +2 points to 3.826% is up to
US T-Bonds are doing pretty well with +3p at 3.407%.
Little action in forex, with the Euro losing 0.2% to $1.0820.
In terms of results, American consumer goods giant Procter & Gamble will publish its accounts in the afternoon before being followed by demand specialist Netflix in the evening.
Next week, earnings season will be especially lively with releases from Boeing, Intel LVMH, Microsoft and even Tesla.
In French company news, Dassault Systèmes announced on Thursday that it will partner with IBM to accelerate the sustainable transformation of industry players through the adoption of ‘virtual twins’.
Arkema announces that it has signed a long-term contract with Engie for the supply of 300 GWh/year of renewable biomethane in France starting January 1, 2023, one of Europe’s largest private biomethane contracts to date.
Nexans announced Thursday that it will redouble its anti-counterfeit cable efforts by joining forces with Austria’s Authentic Vision. Under the terms of the partnership, the French group will adopt the patented “Meta-Anchor” holographic labels.
Finally, Edenred announces that it has entered the capital of Betterway, a French fintech company founded in 2019 and a pioneer in offering mobility tickets in companies with which the group has already been a commercial partner since September 2022.