The Paris stock exchange closed 0.81% lower on Wednesday, in an as usual quiet session before a monetary policy decision by the US central bank, particularly affected by the decline in luxury stocks.
The CAC 40 stellar index lost 51.37 points to 6,276.88 points. The day before it had taken 0.98% for the first session in November, after the strong rebound in October (+ 8.75%).
The Parisian coast had opened into green, but slowly slipped into red throughout the day.
“There has been relatively little movement, as is often the case in markets before the Fed. Volatility will then be released“mainly in US markets.
The Monetary Policy Committee (FOMC) will announce its decision at 7pm, then its chairman Jerome Powell will hold a press conference at 7.30pm.
While a rate hike of 0.75 percentage points is expected, a fourth such hike that will bring them close to 4%, investors will be following the press conference more closely, where they hope for signs of an impending pivot towards monetary policy. less restrictive.
“The bullish rally of the last few days is fueled by the expectation of the pivot and some economic indicators suggest that we are moving in this direction, but it is not taken for granted.“shade Jacques-Aurélien Marcireau, co-head of equity management of Edmond de Rothschild AM.
A nasty surprise could then suddenly reverse the trend. However, “an important point” is a more important “consideration of systemic risk“ of a decline in financial markets if the Fed’s main rate hikes were too rapid, Marcireau noted.
The event outshines the rest of the economic news, particularly early U.S. employment data on Wednesday, with the monthly ADP / Stanford Lab survey showing a still-tense job market, creating 239,000 jobs, plus expected. On Friday, the monthly report from the Department of Labor will follow.
After a sharp rise on Tuesday and Wednesday at the start of the session, led by rumors of a possible easing of health restrictions in China, unconfirmed, luxury stocks fell.
In cosmetics, L’Oreal (-3.01% to € 307.95), it was also affected by the poor results announced by its American competitor Estée Lauder, in particular due to concerns about China.
The collective catering group Sodexo fell by 1.94% to € 87.07 on the day of the presentation of the strategic plan for 2025. The company aims for internal growth of between 8% and 10% in 2023 and between 6% and 8% in the following two years.
In the same sector, Elior it collapsed by 11.61% to 2.13 euros, bringing the loss from January 1 to over 65%. A major investment fund, Citadel, took short positions on the stock.
Le Revenu, with AFP