The Cac 40, with a fall of 6% in September, aligns a third consecutive quarter of decline

The Cac 40, with a fall of 6% in September, aligns a third consecutive quarter of decline

On the Paris Stock Exchange, the bedroom 40 bounced 1.51% today to finish at 5,762.34 points. During the month, the index still lost 6%. It aligns a sixth weekly loss in seven weeks and three consecutive quarters of decline (-2.7% in the July-September two-month period, despite the strong empty rise of almost 9% in July), the longest series since 2009, in a world where accelerating inflation is sure to prompt the biggest central banks again next month to raise their benchmark interest rates to rates not seen for a long time.

In New York, the Dow Jones, the S&P 500 and the Nasdaq Composite also advanced. against the trend, Nike dip 10%. The sports equipment maker cut its annual margin forecast and saw its inventories rise 44% in the latest quarter. In Europe, Cougar yielded more than 5% and Adidas more than 4%.

The rally in stock indices this Friday is likely to be due to a bear market rebound, encouraged by the easing seen in bond markets at the end of a particularly turbulent week marked by the Bank’s emergency intervention. of England to restore calm.

On the geopolitical front, Vladimir Putin announced the creation of four Russian administrative regions in Ukraine, thus formalizing the annexation of the territories consulted by referendum. The inhabitants of Luhansk, Donetsk, Kherson and Zaporizhia become like this “our citizens forever”said Vladimir Putin. He also called on Ukraine to stop fighting and resume negotiations, while ruling out any discussion of the newly annexed territories. The US reaction was swift, as the Biden administration announced new economic sanctions against regime officials and Russian companies.

Inflation record in the euro zone

Investors have cashed in this morning on the impact of a record inflation rate in the euro zone. The increase in consumer prices reached 10% annually in the first estimate for September, compared to the 9.7% expected by the market and 9.1% in August. The statistic comes a day after the announcement of double-digit inflation in Germany, the first since 1951, and reinforces expectations of strong action by the ECB.

“Given the strength of inflation and continued signs of price pressures, we expect the ECB to raise rates again by at least 75 basis points at its meeting in late October, to a low of 1.5%.Jessica Hinds, Senior Eurozone Economist at Capital Economics, reacts. And despite the risks of a deeper recession, we don’t rule out a bigger upside. Overall, we expect the core deposit rate to hit 2% before the end of the year, with further increases early next year bringing it to 3%. The risks of this happening continue to be on the rise.”warns.

The Fed determined even in a recession

In the United States, US household income rose 0.3% in August, as expected, and spending rose 0.4%, twice as expected. The “core” PCE index of personal consumption spending, the measure of inflation favored by the Fed, the US central bank, stood at 4.9% a year, compared to 4.6% in July and 4, 7% expected. Currently scrutinized by the central bank, the component of inflation forecasts at 1 was slightly reduced to 4.7%, according to the final results of the survey of the University of Michigan for the month of September, after 4.8 % in August.

Yesterday, the publication of economic figures considered too good in the world’s largest economy. “were seen as giving the Fed more room to keep raising ratescommented this morning, Jim Reid, strategist at Deutsche Bank. First, weekly jobless claims fell to 193,000, their lowest level in five months, in the week ending Sept. 24. This figure is lower than the 215,000 expected, and the previous week was also revised down by -4,000. This was also not a mere incident, as the four-week moving average is now at its lowest level since the end of the week. of May. We also had an upward revision of the core consumer price index in the second quarter. »

Federal Reserve officials regularly stress the prospect of a cycle of permanently high interest rates. James Bullard, president of the St. Louis branch, said yesterday that investors will not be able to escape sharp rate hikes in the coming months, while his Cleveland colleague, Loretta Mester, warned that a recession would not prevent the Fed from Federal tightened its monetary policy. politics.

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