The surge of the Paris Stock Exchange in reaction to the results of the first round of the legislative elections is already coming to an end. The Cac 40 index fell by 0.8% to 7,501.8 points on Tuesday around 9:15 a.m. It gained a little over 1% yesterday, with a peak of 2.8% during the session, the victory of the National Rally and its allies with 33.14% of the vote being certainly a record for the extreme right but investors feared an even bigger tidal wave.
It is by no means certain that the National Front party will manage to secure an absolute majority at the end of the second round on Sunday. With the withdrawals of candidates from the presidential coalition and the New Popular Front who came in third place (they have until 6 p.m. to make themselves known), some constituencies could escape Marine Le Pen’s troops, which is somewhat reassuring on the markets. The least worst scenario would be a Parliament without a majority, political inertia synonymous with less explosive spending… but also with a lack of progress in cleaning up France’s budgetary situation, which is already quite fragile. There has been some opportunistic buying, but market activity is mainly driven by short buybacks and index management, argues Thomas Helaine, at TP ICAP. Interest in selling remains predominant, about three times higher than interest in buying ».
Jerome Powell arrives in Sintra
The economic calendar is further fleshed out today with Eurozone consumer price figures at 11:00. These are preliminary figures for June and the index is expected to fall by 0.1 percentage points to 2.5% year-on-year and 2.8% in underlying terms. On the monetary front, the European Central Bank (ECB) annual Forum continues in Sintra, Portugal. Jerome Powell, the chairman of the US Federal Reserve, will join his ECB counterpart for a debate at 14:30. In her opening speech at the symposium yesterday, Christine Lagarde reiterated that there is not yet sufficient evidence that inflation threats have passed, reinforcing the prospect of a status quo at the July 18 meeting.
Across the Atlantic, attention will be focused on the Jolts report on job openings for May, released at 4 p.m. The indicator, closely scrutinized by the Fed, is expected to contract again. The Bloomberg consensus is for 7.95 million job openings, compared to 8.06 million the previous month.
Teleperformance: AI threat overestimated, according to analysts
The collective catering group Sodexo fell by 3.5% after announcing a turnover for the period from March to May of 6.07 billion euros, up 6.8% at constant scope and exchange rates, which is in line with its expectations but slightly lower than analysts’ forecasts.
On the analyst side, Morgan Stanley has revised its advice on Teleperformance (+3.9% on the stock market) from “inline weighting” to “overweighting”, arguing that fears about the disruptive threat that artificial intelligence represents for the call center specialist ” exceeds reality “. Deutsche Bank upgrades Euronext from “hold” to “buy” and Stifel begins monitoring Engie with a buy rating and a target price of 18.20 euros. The stock exchange operator gains 1% while the energy supplier gains 0.8%.
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Teleperformance, Euronext, Engie, Air France-KLM, EssilorLuxottica, Veolia, Sanofi, Eurofins Scientific, Saint-Gobain, Accor, Publicis, Air Liquide: all the analysts’ recommendations
