The Paris Stock Exchange fell by 0.68% on Wednesday morning, penalized like the rest of the world markets by the return of fears of recession in the United States and the decline in the semiconductor sector. The main CAC 40 index fell by 51.16 points to 7,522.86 points around 09:50, after having dropped nearly 1% in early trading. On Tuesday, the index lost 0.93% to end at 7,575.10 points. On Wall Street, the Nasdaq index was the one that suffered the most on Tuesday: -3.26%, weighed down by a fall of more than 9% of the American chip giant Nvidia, victim of profit-taking like the rest of the microprocessor sector.
In the wake of this risk aversion in the United States, Asian stock markets fell on Wednesday, especially in Tokyo, where the Nikkei index lost 4.24%. “Stress returns before US employment figures”note analysts at Natixis CIB Research. The trigger for this risk aversion was the publication on Tuesday of the ISM index concerning activity in the manufacturing sector, which remained in contraction in August in the United States, with a level of new orders at its lowest since May 2023. “This suggests that global growth is likely to remain limited in the coming months.”observes Xavier Chapard, from the LBP AM research and strategy team.
The data revived recession fears that contributed to the stock market crash in early August, and sent markets tumbling Tuesday, including oil and bond yields. Investors are looking ahead to the crucial monthly U.S. jobs report on Friday, and will also see other data on the U.S. labor market throughout the week. “The US employment figures released on Friday will be crucial”particularly given the sharp interest rate cuts expected by investors within the next year, estimates Xavier Chapard. In Europe, PMI activity indices for several eurozone countries are on Wednesday’s agenda.
Also readParis Stock Exchange Jumps 2%, Less Concerned About Risk of Recession in the United States
Fleas chased away
In the wake of Nvidia’s 9.53% fall on Wall Street, the entire microprocessor sector on the markets. In Paris, STMicroelectronics fell by 2.10% to 26.79 euros and Soitec lost 3.80% to 103.90 euros.
The semiconductor sector has benefited for almost two years from the craze for artificial intelligence. The value of Nvidia shares has notably increased sevenfold in two years. But now investors are wondering whether these valuations are not too high. Ipek Ozkardeskaya, an analyst at Swissquote Bank, observes in particular “a sign of fatigue” investors around the theme of chips and artificial intelligence. In addition, according to several American media, the American Department of Justice is investigating possible competition violations by Nvidia.
Also readFrom Wall Street to Paris, global stock markets are sinking amid fears of a recession in the United States
China weighs on luxury
More sobering data has been released on the Chinese economy, a major market for the luxury sector. The PMI activity index, calculated by the S&P Global consultancy and the Chinese economic media Caixin, showed on Wednesday that activity in the services sector in China slowed in August with one of the slowest growth rates this year. LVMH fell by 2.27% to 655.80 euros, Kering by 2.12% to 248.75 euros and Hermès by 1.34% to 2,135 euros.
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