Wednesday, January 19

The Paris Bourse in sharp decline weighed down by the Fed

The control room of Euronext, the company which manages the Paris Stock Exchange, at La Défense, November 21, 2019 ERIC PIERMONT

The Paris Bourse fell 1.63% Thursday morning, shaken by the latest report of the discussions of the US central bank which envisages rate hikes faster than expected.

At 9:25 a.m., the CAC 40 star index dropped 122.42 points to 7,253.95 points. On Wednesday, it finished 0.81% higher, setting its third record in as many sessions in 2022.

In Asia, the Tokyo Stock Exchange fell 2.88%, its worst session in more than six months.

The New York Stock Exchange ended sharply lower on Wednesday with a loss of over 1% for the Dow Jones, nearly 2% for the S&P 500 and a drop of 3.34% for the Nasdaq.

“This was our main certainty at the end of 2021: volatility would be on the rise this year with the reduction in liquidity offered by central banks, in particular that injected by the Fed”, the Federal Reserve, notes Tangi Le Liboux, strategist at Aurel BGC .

This trend reversal from the records reached in the first days of the year comes from the publication of the minutes of the last meeting of the Federal Reserve’s (Fed) monetary policy committee, which show a willingness to tackle head on against inflation.

The members of the Fed have indicated, in unequivocal language, that they now plan to raise the institution’s key rate earlier and more often than expected.

Inflation continued to accelerate in November in the United States, to stand at 5.7% compared to the same month of 2020, the largest increase in prices since 1982.

In addition, it is now a question of starting to reduce the Fed’s balance sheet immediately after the first rate hike, which took operators by surprise.

Tech is falling

Tech stocks, which need low interest rates to finance their growth, were overlooked by investors on Thursday.

Capgemini fell by 3.29%, Dassault System by 2.68%, Teleperformance by 2.66% and OVH Groupe by 1.81%.

Resumption of orders for Dassault Aviation

Dassaut Aviation (+ 2.08% to 103.10 euros) replenished its order book in 2021 with more Falcon business jets purchased than before the health crisis and significant order intake for the aircraft of Rafale fight.

Potentially coveted crossroads

According to information from the financial news agency Bloomberg and the business daily Les Echos, Auchan would return to the assault to acquire its rival Carrefour with new investors, after the failure of discussions in the fall. The Carrefour action took 3.91% to 17.93 euros, after having jumped 5.09% the day before.

  1. Euronext CAC40

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