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In the absence of unpleasant surprises on the American inflation front, in the sense of PCE prices, against a backdrop of relief after the publication of the quarterlies of two American tech monsters, the CAC 40 ended the last session of the week up 0.89% to 8,088 points. On the quarterly side of the large French groups, one word continued to sum up the situation: contrasting!
Excluding food and energy, PCE (personal consumption expenditures), the Fed’s favorite barometer in its assessment of inflation, rose monthly by 0.3%, perfectly within the target. Not enough, therefore, to influence the outlook for the trajectory of rates for the months to come. However, as Jeanne notes, over one year, “PCE inflation is higher than expected in March at 2.7% per year in total and 2.8% in the “core”. Over 3 months (annualized), the “core” inflation accelerates to 4.4%, driven by services to 5.5%.”
The market is also digesting a new burst of results. With good news, on the side of Saint-Gobain which takes the lead in the CAC 40 this Friday evening (+6.9%) after delivering satisfactory revenues and indicating that several markets are close to an inflection point.
Totalenergies gained 2.1%, to a new historic high closing at 69.48 euros, after flirting with 70 euros during the session. The group published results very slightly above expectations in the first quarter. Above all, its CEO Patrick Pouyanné admitted to Bloomberg that the company was considering transferring its main listing to New York rather than Paris, to get closer to its shareholder base and distance itself from a cautious Europe. regarding its strategy in renewable energies.
And less good, on the Airbus side, which limited its decline to 0.9% after clearly missing expectations for its first quarter, even if its results were penalized by a series of exceptional elements.
Excluding the flagship index, Nexity jumped 7.2% after reporting quarterly activity in line with expectations and giving details of its transformation plan intended to revive itself.
On the other side of the Atlantic, the main equity indices ended the last session of the year in the green, like the Dow Jones (+0.40%) but especially the Nasdaq Composite (+2 .03%), towed by Microsoft and Alphabet, who published excellent quarterly copies the previous evening. The S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, gained 1.02% to 5,099 points.
“Even if the results of the tech giants this week have moved the indices, the feeling is that more favorable inflation figures will also be necessary for the historic highs to be revised on the SP500, the Dow Jones or even the Nasdaq100 after the recent correction,” warns Alexandre Baradez (IG France).
An update on other risky asset classes: around 8:00 a.m. this morning on the foreign exchange market, the single currency was trading at a level close to $1.0720. The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $83.00.
On the agenda this Monday, priority will be given to consumer prices in Germany.
KEY GRAPHIC ELEMENTS
Now is the time to take a breather from the lessons. The CAC index has traced, in contact with the upper Bollinger band, two candles where the low points, the opening level and the closing level merge. And this before starting a slow decline towards the lower part of an ascending channel (in black) on the daily chart. The session of Tuesday April 2, by the volumes, the length of the red body of the corresponding candle, reinforced the 8,220 points as a difficult level to cross.
Then a major technical event occurred, namely the breaking of the gap, the highly symbolic threshold of 8,000 points. The latter, however, does not appear as a scar on the index in the sense that it was filled in from the following session.
We are in the heart of a deep, legitimate breath on the flagship tricolor index.
Two bearish targets present themselves: the bullish gap of February 22, the lower limit of which is worth 7,821 points, then the intermediate support at 7,700 points. Until then, the occasional formation of sharp downward acceleration in prices is not excluded, before remobilization of the buying camp.
FORECAST
Considering the key graphical factors that we have identified, our opinion is neutral on the CAC 40 index in the short term.
We will take care to note that crossing 8120.00 points would revive the buying tension. While a break of 8000.00 points would restart the selling pressure.
Hourly graph
Graph created from the software Prorealtime
Daily Data Chart
Graph created from the software Prorealtime
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