The Paris Stock Exchange ended up 0.26% on Wednesday, with investors showing caution a few hours before knowing the outcome of the meeting of the American Federal Reserve (Fed).
The flagship CAC 40 index closed the session at 7,384.62 points, a loss of 18.92 points. The day before, it had gained 0.12% to 7,365.70 points.
“Everyone is waiting for the Fed this evening,” summarizes Lionel Melka, managing partner at Swann Capital, to AFP.
The majority of analysts expect a reduction of 0.25 percentage points in the key rates of the American central bank.
But several recent data demonstrate the persistence of inflation and the resilience of activity in the United States, which encourages investors to be cautious following the rate cuts.
This “once again underlines the uselessness of a further rate cut by the Federal Reserve today. But the Fed will still announce a cut of 0.25 points, whatever happens”, estimates Ipek Ozkardeskata, analyst for Swissquote Bank.
Beyond the decision, it is “the comments and the press conference of Jerome Powell”, the president of the institution, which are eagerly awaited, recalls Lionel Melka.
The upcoming arrival of Donald Trump at the White House casts uncertainty over the American and global economies.
Jerome Powell could “indicate that the Fed is willing to go slower in the rate cut cycle,” according to Christopher Dembik, investment strategy advisor at Pictet AM.
Investors “could potentially be very disappointed by rate cuts that are less steep than expected” if the American central bank “considers that there is still a little inflation to be curbed”, adds Lionel Melka.
On the bond side, the ten-year French bond reached 3.05%, compared to 3.03% the day before at closing.
Renault leaps
The title of the French automobile group Renault ended up 5.21% at 46.82 euros after the Japanese giant Honda (-3.04% at the close in Tokyo) indicated that it was exploring the possibility of a merger with its compatriot Nissan (+23.70%).
Renault still owns 17% of Nissan directly and 18.6% via a trust, for a total of 35.6%.
This merger could accelerate the unraveling of Nissan’s historic alliance with Renault, which has already been gradually reducing its presence in the Japanese group’s capital since last year.
Euronext CAC40
