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Paris (AFP) – The Paris Stock Exchange ended sharply down 0.95% on Thursday, as pessimism on Wall Street spread to Europe after the release of strong economic indicators that revived concerns about monetary tightening.
The star CAC 40 index fell 62.27 points to 6,517.97 points, after a start to the session, however, in the green. The day before, it had taken 2.01%, during its best session since November 4.
The growth of the gross domestic product (GDP) of the United States in the 3rd quarter was revised upwards, announced the Commerce Department, and stood at 3.2% at an annualized rate, which surprised analysts. This figure had already been revised upwards.
“It’s paradoxical but the market is waiting for bad news on the American economy”, in order to materialize the hopes of investors to see the American Federal Reserve change its tone in its monetary policy, explains Charles de Riedmatten, equity manager of Myria AM .
“The data is still very strong, so we risk continuing on a rhythm of rate hikes meeting after meeting”, he adds.
In Europe, the determination of central bankers is not weakening either: “50 basis point increases could become the new norm in the short term” and “for a while”, reaffirmed to the newspaper Le Monde the vice-president of European Central Bank Luis de Guindos.
“The measures taken so far will have an effect on inflation, but we must do more,” he warned.
Investors further reacted negatively to weaker-than-expected results from semiconductor maker Micron, which reported a 38% drop in revenue and a net loss in the first quarter of its staggered fiscal year.
“Micron is at the end of the chain, so this confirms a slowdown in orders and therefore a slowdown in the economy”, comments Charles de Riedmatten.
Trading volumes on the CAC 40 did not exceed 2.5 billion euros, a low level which can amplify variations.
The car slips
Stocks highly dependent on the economic situation were penalized on Friday, a sign that fears of recession are very present in the minds of investors.
The automotive sector fell particularly: Renault finished dead last in the CAC 40, down 3.72% to 31.21 euros. Stellantis lost 3.22% to 13.11 euros, Valeo 4.49% to 16.50 euros and Faurecia 3.40% to 13.50 euros.
Other industrial stocks suffered, like Schneider Electric (-2.30% to 130.84 euros) and Legrand (-2.11% to 75.04 euros).
Orpea still depreciated
The action of the group of private nursing homes Orpea fell 5.26% to 5.79 euros. Orpea on Wednesday almost doubled the anticipated amount of its asset write-downs, to a level between 5 and 5.4 billion euros, against 2.1 to 2.5 billion euros previously forecast.
Since the start of the year, the stock has fallen 93.42%, the biggest drop in 2022 for the values of the SBF 120, due to the scandal over the treatment of its residents.
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