AFP, published on Friday 06 January 2023 at 10:20
The Paris Stock Exchange was stable on Friday morning, holding no position after a pompous start to the year and before the release of several economic indicators in Europe and the United States.
At around 9:45 am, the leading CAC 40 index was stable (-0.02%) at 6,759.91 points. Over the week, it increased by 4.42%, the best weekly performance since the end of March 2022.
“We had a start to the year where risk-taking dominated and long-term rates fell. (…) We believe that a less deteriorated-than-expected economic situation in the eurozone, aided by massive aid budgets and by a drop in the price of gas has contributed to changing the perception of market participants in the short term,” describes Sebastian Paris-Horvitz, research director at Banque Postale AM.
Among the positive signals retained by investors, the drop in gas and oil prices, but also the slowdown in inflation observed in France and Germany in December. The data for the Eurozone will be released at 11:00, concurrently with the retail sales.
Still, it’s “hard to think that the market can withstand a future economic deterioration,” and especially with expected rate hikes by central banks, Paris-Horvitz believes.
Particular attention will be paid to the US Federal Reserve (Fed), with its interpretation of the US employment data, which will be released at 14:30 Paris time.
An overly tight labor market, with low unemployment and wages continuing to rise rapidly, would therefore not be seen as good news, as this will encourage the Fed to maintain an aggressive stance with sharp rate hikes in the coming months and no decline in 2023.
Among economic indicators already released on Friday, household consumption in France rebounded slightly in November, rising 0.5% after a sharp 2.7% drop in October, driven by higher spending on manufactured goods, l reported. ‘INSEE.
Sodexo better but not enough for the market
Catering and services group Sodexo reported on Friday a “strong start” to its business in the first quarter of its 2022-2023 staggered financial year and delivered on its forecast. This did not prevent the stock from suffering the steepest drop of the broader SBF 120 index, which fell by 3.54% to €87.17, dragging along Derichebourg (-2.47% to €5.73), which rose to its capital. Elior also fell by 1.53% to 3.65 euros.