The Paris Stock Exchange closed down 0.30% on Tuesday, giving up some of the gains from Monday’s initial rebound, cooled by inflation figures in the euro zone and still scrutinizing French political life.
The leading CAC 40 index fell 22.84 points to close at 7,543.15 points, after falling well below 7,500 points in mid-session. On Monday, it had gained 1.09%, after jumping as much as 2.8% in early trading.
The market has “frozen” in the feeling that the second round of elections will not produce an absolute majority for the National Rally, the last political force that can still claim one, believes David Kruk, head of trading at La Financière de l’Echiquier.
More than 210 candidates have withdrawn in an attempt to form a “republican front” against the far-right party, according to a count carried out by AFP.
This sentiment is likely to remain “until Sunday”, with market players coming to terms with the parliamentary paralysis that could result, according to Mr Kruk.
As a sign of investor relaxation, the gap between the interest rate for the 10-year French loan and its German equivalent, which is the benchmark in Europe, has narrowed further.
The French 10-year loan is moving at around 3.32%, compared to 2.60% for the German, a gap of 72 basis points, whereas it peaked at more than 85 basis points shortly before the first round of the elections.
But the French elections are not the only event investors are watching. On Tuesday, they received some bad news with eurozone inflation figures that were unfavourable, and notably above expectations in some key areas, such as services.
This reinforces the cautious speech given on Monday by the president of the European Central Bank (ECB), Christine Lagarde.
However, US central bank chairman Jerome Powell gave markets a fresh boost after saying he saw progress in disinflation in the US, reports David Kruk.
He also reiterated that the Fed was “waiting to have more confidence” in the slowdown in price increases “before starting to ease monetary policy.”
Michelin braked
Michelin fell 3.10% to 34.98 euros, the worst performance in the CAC 40, the day after a preparatory call with analysts ahead of half-year results. The company warned that sales volume momentum is weaker than expected, analysts reported.
Cora goes to Carrefour
The retail giant Carrefour (+0.86% to 13.51 euros) announced on Monday evening that it was officially buying the Cora stores from the Belgian group Louis Delhaize, which will switch to the Carrefour brand, as well as the Match stores, which will keep theirs.
Sodexo sanctioned
The collective catering and services group Sodexo saw its turnover growth slow slightly with inflation, but confirmed its annual objectives thanks in particular to a “robust” development in catering services.
Sanctioned, its title dropped 4.73% to 81.65 euros.
Euronext CAC40
