(AOF) – In the green until the beginning of the afternoon, European stock markets ended up falling into negative territory. With the backdrop of Donald Trump's victory in the American presidential election and its consequences on the Old Continent. The CAC 40 fell by 0.51% to 7369.61 points while the EuroStoxx 50 fell by 1.53% to 4795.77 points. In the United States, the indices are conversely trending positively with the Dow Jones up 3.18%, around 5:45 p.m.
Rising at the opening, the European stock markets followed American time and witnessed the victory of Donald Trump, made official at the end of the morning at the expense of the Democratic candidate, Kamala Harris. The billionaire, who is preparing to serve a second term at the head of the White House, was approved by 277 voters against 224 for his rival.
But the Trump effect did not last, the indices having lost ground before migrating into the negative zone at the start of the afternoon.
“We expect many of his populist policies to make waves, although markets have been largely priced based on this outcome,” AllianzGI poses.
According to the management company, Donald Trump's emphasis on lowering corporate taxes and further deregulation should favor American companies, particularly small companies with attractive stock market valuations . To some extent, tech companies could benefit from their loyalty to Donald Trump.
Christopher Dembik, investment strategy advisor at Pictet AM, believes that a new Trump era “is not necessarily bad news for Europe”. “It is certainly easier for Europe to manage Trump's transactional approach than the all-out subsidy policy led by Biden and allegedly continued by Harris,” and which “resulted in high-speed deindustrialization of Europe”.
Wednesday's statistics were somewhat overshadowed by the political and international highlights of the day. The Composite PMI in the euro zone came out better than expected: at 50 in October against a consensus of 49.7, indicated S&P Global. It was 49.6 in September.
The Fed on the menu for Thursday
Trump's victory comes as the Fed delivers its monetary policy decision tomorrow.
On the foreign exchange market, the American currency rose sharply, with the euro losing 1.75% to $1.0738. Bitcoin, for its part, exceeded the $75,000 mark for the first time.
Among the major points of the economic program of the now 47th President of the United States: customs duties and tax reductions.
Donald Trump predicts that deregulation and tax cuts “would give a temporary boost to growth, which, alongside the implementation of customs duties, would cause a resurgence of inflation”, underlines Christophe Boucher, Chief Investment Officer of ABN Amro Investment Solutions.
In Paris, while Donald Trump wants to increase hydrocarbon production to meet needs, stocks linked to oil exploration have been sought after like Vallourec, Viridien and Technip Energies.
Publicis took advantage of the “Trump effect”. The communications group is strongly exposed to the American market while election periods are quite favorable for advertising spending, specifically in the United States.
On the other hand, Rémy Cointreau and Pernod Ricard fell, penalized by the prospect of increased customs duties in the United States.
Crédit Agricole finished at the bottom due in particular to the disappointing performance of its insurance business in the third quarter.
