The specter of a faster and more severe monetary tightening than expected destabilized financial markets. At the end, the Bedroom 40 fell 1.99%, wiping out the performance (-0.12%) in four days (the stock market was closed on Easter Monday). The threshold of 6,700 points, reached on Thursday, has been abandoned, the Paris index even drops below 6,600 points on the eve of the weekend, at 6,581.42. The turnover volume amounted to 3.9 billion euros. On the other side of the Atlantic, the trend is similar: the Dow Jones and the Nasdaq composite extended their decline, yielding 1.5% and 0.7% respectively.
During a debate on the economy organized by the International Monetary Fund (IMF), head of the US Federal Reserve Jerome Powell was clear: the scenario of a rate hike of 50 basis points fed funds † comes on the table at the Fed meeting on May 3-4† The aim is to act a little faster against inflation, which is at its highest point in the country in 40 years, the head of the institution justified. The market, which had recently relegated this theme to the background, too busy analyzing business results, was shocked. Jerome Powell’s comments are being interpreted as promising increases of at least two half-points by the summer, after a quarter-point tightening in March. For their part, Nomura analysts expect two increases in interest costs of 75 basis points in June and July, which would be unheard of since 1994. In the bond market, government bond yields rose to 2.975% and the two-year yield rose eight points at 2.789%.
In the euro zonethe tightening virus does not spare the European Central Bank (ECB† Several of its officials have sharpened their rhetoric, such as Vice-President Luis de Guindos, who calls for a end of asset purchase program in July, and not in the third quarter, or from Pierre Wunsch, the governor of the National Bank of Belgium, who estimated that the ECB could raise its key rate slightly above zero before the end of the year. These statements are not to the liking of the chairman of the institution, Christine Lagarde, who called on her teams to order† According to information from the news agency Reuterswould have asked French ECB officials not to express dissent on monetary policy decisions in the days that followed.
barrier absorbed water
The Fed’s more “hate” approach clouded the quarterly results of companies, which were very numerous. The operators had to separate the wheat from the chaff, which meant that they sometimes had to severely punish certain publications. Last of the “Khol” to publish its sales on March 31, barrier was reserved for the decline at the start of the session, before ending in a sharp decline of 4.32%. If luxury group revenue increased 27.4% on a reported basisthose of the flagship brand, Gucci, have been delayedan increase of only 13.4%, after a growth of 31.6% in the fourth quarter of 2021. The group invokes the latest restrictions in China to explain this underperformance.
also down, Essilor Luxottica fell 2.62%, after the announcement of a turnover increased by 38.1% in the first quarter, at 5.6 billion euros. It was more the forecasts that disappointed: the eyewear maker warned that the restrictions put in place in China to fight Covid-19 will weigh on activity in April and that the impact of inflation will be greater than expected in the second and third quarters than in the first.
The Renaulution plan is bearing fruit
Renault lost 1.34%. The carmaker’s quarterly figures inevitably bear the traces of the war Ukraine, as Avtovaz’s contribution fell by 23.1%. Nevertheless, thanks to the Renaulution plan, which emphasizes value creation, scaling and pricing, the group saw its turnover drop by only 2.7% as of March 31 to 9.7 billion euros† Renault is considering a First public offering of its electrical business in 2023.
on his side, vinci (-1.85%) published quarterly sales of EUR 12.85 billion, an increase of 26% year-on-year in reported data and 12% on a comparable basis. This allows management to confirm its forecasts for 2022, in particular a net result that is higher than that of 2019. For Vinci Airports, the group expects traffic to represent approximately 60% of the 2019 level.
Finally, of the other companies that reported results, Office Veritas (+4.57%) and Ipsos (+4.51%) ended, while GTT decreased by 4.24%.
CP
