The Paris stock exchange rebounded 2.77% on Friday, largely driven by the luxury sector which benefited from speculation about an easing of China’s zero-Covid policy.
The flagship CAC 40 index gained 173.16 points to 6,416.44 points, the highest closing level since August, after losing 0.54% the day before, weighed down by announcements from the US Central Bank (Fed) . During the week, the Parisian rating took 2.29%.
Investors speculate on a possible easing of Chinese anti-Covid measures, not yet confirmed by Beijing. A meeting of the Chinese health authorities will be held on Saturday.
“It appears that China may end a restrictive policy towards its airlines” and “that a messenger RNA vaccine for foreign residents has been approved in China”, details Raphaël Thuin, head of capital markets strategies Tikehau Capital.
“China is a cause for concern for the markets because we know that its restrictive policy slows growth” of the country, he recalls.
Luxury, of which China is a very important market, particularly benefited from these rumors and allowed the CAC 40 index to reach its highest closing level since August 19.
China is the latest major economy to apply a strict anti-Covid policy, which involves repeated confinement, population testing several times a week, and lengthy quarantines.
Investors also paid attention to the US labor market data released on Friday. The unemployment rate rose to 3.7% in October while there were 261,000 job creation, a figure higher than analysts’ expectations.
These data show the first signs of a “cooling of the labor market”, according to Thuin, but they are not yet sufficient to persuade the US central bank (Fed) to modify its monetary policy, which is currently very restrictive.
Investors unsurprisingly welcomed the Fed’s further 75bp interest rate hike on Wednesday, but their hopes for a pause were dashed when the Fed announced that interest rates would be held at a low. low level, higher and for a longer period than expected.
Luxury enhanced by China
In Paris, as in other European equity markets, shares in the luxury sector rose on Friday.
Posting the largest increase in the CAC 40, Kering took 7.07% to € 503.40, also supported by a Wall Street Journal article reporting “advanced discussions” about the acquisition of the Tom Ford brand.
L’Oréal gained 6.78% to € 321.40, LVMH 5.75% to € 666.20 and Hermès 3.71% to € 1,357.
Mining on a good vein
Like the luxury sector, mining stocks benefited from speculation on China.
ArcelorMittal took 6.48% at 23.51 euros, Eramet 10.01% at 75.80 euros and Aperam 9.02% at 28.29 euros.
The Societe Generale saluted
Société Générale earns 2.55% to 24.10 euros, after posting a slight increase (+ 2.3%) over one year in the third quarter before the opening, but profits down 6.4% , weighted by the remuneration of regulated savings accounts and by the provisions established in the event of unpaid invoices.
JC Decaux is a success
The display ad giant posted sales growth of more than 14% in the third quarter, above expectations, but remains impacted by travel restrictions in China. The group’s share price rose 14.34% to 14.75 euros.
jvi / mdz / clc