CAC40: US CPI showers all markets, stocks and prices – 10/13/2022 at 3:22 p.m

The Palais Brongniart, former headquarters of the Paris Stock Exchange.  (Image credit: / L. Grassin)

The Palais Brongniart, former headquarters of the Paris Stock Exchange. (Image credit: / L. Grassin)

( – Big cold shower on the markets at 14:30 with the most anticipated number since the beginning of October, namely the US CPI: Inflation is stronger than expected and the CAC40 loses -170 points (-2 0 .75%) in a straight line in 5 minutes as part of what will be one of the most violent counterattacks this year.

Some buyers attempted to bluff ahead of the release, causing the CAC to rise more than 1% between 12:00 p.m. The big challenge for this session will be to hold the yearly low of 5,675 into the weekend (close to 1% safety margin).

France is also in a context of social tensions and above all a possible paralysis of activity with dry fuel stations, strikes in nuclear power plants, a dockers’ strike and rumors of SNCF hiring: without fuel and without public transport, it is the scenario of 1995 , which is beginning to dawn with the consequent threat of a sudden plunge into recession.

The CGT’s unprecedented call for a general strike since May 68 – if followed – is likely to worry France’s creditors and our OATs see their yield rise +7 points towards 3.02%.

The Euro-Stoxx50 fell -2%, falling back to 3,260 in the wake of Amsterdam, which fell almost -3%.
The monthly US inflation report released by the Department of Labor comes in worse than the worst forecasts: the US CPI rose 0.4% in September and +8.2% compared to the same month 2021 (after 8.3% in August, but Jefferies, like many other brokers, expected a drop to 8.1%).

Excluding energy (+19.8%) and food (+11.2%), two traditionally volatile categories, the annual “core” inflation rate rose +0.4% mom to 6.6%, the worst performer since … 1982.

Jobless claims in the United States rose +9,000 to 228,000 for the week of October 3, up from 219,000 the previous week, according to the Labor Department.

The four-week moving average – which can be seen as a better indicator of the underlying trend in the jobs market – is also up slightly, coming in at 211,500 versus 206,500 a week earlier.

The Fed’s “minutes” released on Wednesday evening did little to reassure: “Fed officials expect interest rates to remain high for some time. They will keep increasing them until they see clear signs of inflation slowing down,” summarizes Wells Fargo, a bank in California.

US T-Bond yields declined +17 pts towards 4.07%, the ’30 years’ hit 4% resulting in a -2.2% decline in the S&P500 pre-open (below 3,500 pts) and – 2.5% Nasdaq led.

The euro fell -0.5% to $0.9655, only the sterling rallied +0.8%, while Liz Truss indicated that she would back down on her tax reform, many observers say suggests that the Bank of England and markets have “won” (but at the cost of horrendous falls in UK Gilts, which ease from -20p to -25pt.

That doesn’t stop the London stock market from falling -1.5%.

In terms of values, Eiffage announces the acquisition of 70% of the capital of SNEF Telecom, a subsidiary of the SNEF Group and a major player in the French mobile market with a turnover of almost 200 million euros in 2021.

The day after its meeting with unions, TotalEnergies said it had informed them it was ready to consider a budget for 2023 pay rises based on 2022 inflation.

In addition, the Group announces the allocation of a special bonus of one month’s salary to all its employees worldwide, to be paid in December, subject to salary agreements in the various countries and subsidiaries concerned.

Oddo BHF reiterates its “outperformance” view on Sodexo with a price target raised from 82 to 92 euros, while the catering and services group will hold an Investor Day (CMD) in Paris on November 2nd.

#CAC40 #CPI #showers #markets #stocks #prices

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