2023-06-30 17:11:35
The Paris Stock Exchange ended up 1.19% on Friday, gaining more than 14% over the half-year, driven by slowing inflation in the United States and the eurozone, the economy showing resilience despite the increases central bank rates.
The flagship CAC 40 index rose by 87.33 points and is positioned on the 7,400 point level at just 7,400.06 points, a closing high since May 22.
“We are coming to the end of the semester with an American economy that has contradicted the most pessimistic expectations and with disinflation,” underlines Sophie Chauvellier, manager of Dorval AM.
On Friday, inflation in both Europe and the United States came down after months of monetary tightening led by central banks around the world.
In the United States, inflation slowed in May to 3.8% year on year, against 4.3% the month before, according to the PCE index published Friday by the Commerce Department, a measure favored by the bank. US central (Federal Reserve, Fed).
Since March 2022, the Fed has raised its main key rate ten times in a row with the aim of slowing inflation and eventually bringing it back to around 2%.
After marking a first break in this series of increases in June, Jerome Powell, the boss of the Fed, however, did not rule out this week that the American monetary institution could proceed with two new rate hikes, possibly consecutive.
On the old continent, the annual inflation rate in the euro zone fell to 5.5% in June, after 6.1% in May, thanks to a sharp decline in energy prices, Eurostat announced on Friday.
The unemployment rate there remained stable in May, at 6.5% of the active population, at its lowest historical level as in April, according to data published Friday by Eurostat, another sign of the resistance of the economy.
“All of this is going in the right direction, without this being able to call into question the action of the Fed”, nor that of the European Central Bank (ECB), judge Sophie Chauvellier.
“There was a phase of uncertainty during the semester, when the bankruptcy of Silicon Valley Bank (SVB). This had disturbed the market, which put itself in the configuration of a possible major shock, and finally, the recovery was quick,” she explains.
The markets continued to rise, benefiting from a “positive cocktail” composed of “disinflation and the resilience of the economy”, adds the manager.
Rallye and Casino at historic lows
At the close, Rallye lost 24.77% to 0.57 euro, its lowest level ever. Since January 1, the fall has been even more dizzying, with the value of the share having lost nearly 79% over the half-year.
On the other hand, Casino, of which Rallye is the parent company, posted the third biggest drop of the semester. Its action ended down 20.04% at the end of the session, at 4.07 euros, also reaching its historic low. Since January 1, Casino has collapsed by 58.30%.
The prospect of “massive dilution” for shareholders under Rallye’s colossal debt restructuring plan, announced on Wednesday, is scaring investors away.
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