The Paris Stock Exchange closes far from its daily high. The Cac 40, which developed to eight-week highs mid-session (+1.3%), finishes with a much more modest 0.64% gain to 6,513.39 points on very low trading volumes while the major US indices are in the red. Great caution ahead of tomorrow’s release of key economic data for the United States: employment for the month of July, with a wage sub-component in particular that will shed new light on inflation.
The Bank of England raises its voice
The more aggressive turn by central banks is confirmed by the expected increase in the Bank of England’s repo rate by 50 basis points to a current level of 1.75%. It’s the biggest rate hike since 1995 and the sixth since December 2021. The Old Lady of Threadneedle Street has also raised its inflation forecast to 13% yoy through the end of 2022, from around 10% estimated in May.
In the United States, the Federal Reserve’s stance and questions about the extent of its next monetary tightening appear to have been sidelined, although several central bank officials have warned markets of their false hopes of the Fed halting its rate hikes anytime soon and early next year even lower, although the majority of investors do not believe in an imminent recession.
Jim Reid, strategist at Deutsche Bank, scoffs at this lack of consistency. “Equities have recently rallied on weaker growth, which the Fed saw as a way to limit rate hikes. And yesterday, shares rose on stronger economic data regardless of the potential Fed impact. »
Several observers doubt the continuation of the stock market rally as the rally comes at very low trading volumes, buoyed by the year’s big losers, with a return to the mercy of ‘meme stocks’.
Inflation figures for the United States for the month of July will be released next week.
Crédit Agricole better than expected, rumors about Ubisoft
Waiting, agricultural loan up 4.6%. Like BNP Paribas and Société Générale, the green bank reported better-than-expected second quarter results thanks to record investment banking activity and sales of hedging products. BNP Paribas and Society Generale just over 2% gained
Next to the flagship index Air France-KLM up more than 3% while in the same sector Lufthansa ends with a plus of 6% in Frankfurt. The German airline, which also published its quarterly results, has announced that it expects further growth in its results due to a sharp increase in demand. In particular, she expects a “considerable growth” of its third quarter results on a sequential basis.
Better SRD performance, Ubisoft Soared 11% following rumors spread by Reuters that Chinese company Tencent intends to increase its stake in the video game publisher, in which it acquired a 5% stake in 2018.
Vice versa, HIS down 9%. The satellite operator declined to comment on the information FinancialTimes that he is discussing a possible merger with the American Intelsat. SES also confirmed its 2022 financial targets after the first half was supported by its Networks division and confirmed the decline in video activity.