August began uncertainly at the Paris Stock Exchange, Market News

The Paris stock exchange, after a sharp rise in July (almost +9%, the first real monthly rise this year), started August on a very uncertain note. On this first day of the month Bedroom 40 fell several points (-0.18% to 6,436.86 points) on weak trading volume of 2.8 billion euros. Renault, EssilorLuxottica and Engie, which released their half-year reports on Friday, are among the top performers in the index. With a gain of 10% in two sessions, the automaker has almost erased all its losses for the year.

Better-than-expected results from HSBC and the shipment of the first batch of Ukrainian grain from the Odesa port helped limit the impact of a slowdown in manufacturing activity in China and the eurozone, fueling recession fears. On the other side of the Atlantic, manufacturing activity has worsened, although it continues to grow. The Institute for Supply Management’s (ISM) purchasing managers’ index fell 0.8 points to 52.2, the lowest level since April 2020, remaining above the critical 50-point threshold that separates growth from contraction.

On Wall Street, the Dow Jones and S&P 500 are stable.

78 allusions to inflation on 26 pages

Several economists believe the optimism that swept the stock market last week about a change in the U.S. central bank’s monetary policy is overblown, to say the least, especially after Neil Kashkari, president of the Minneapolis Fed, confirmed on Sunday that the Federal Reserve’s main goal is to return inflation to 2%, while his counterpart at the Atlanta Fed, Rafael Bostic, said shortly before that there was still a lot to be done in terms of monetary policy tightening.

This weekend, Larry Summers, former US Treasury secretary under President Clinton, said the US central bank was seriously mistaken if it seriously believed that the key rate, raised to a range of 2.25-2.5%, had reached neutrality. (a level that neither slows nor stimulates growth) and that, therefore, they no longer need to be raised significantly to combat inflation.

Bank BNY Mellon also recommends not to bet too much on a more dovish turn. [« colombe » ou accommodant] Fed by interest rates. “We believe that the press conference [de Jerome Powell] actually contains some elements of ‘hawkish[faucon], including 78 different allusions to inflation in a 26-page transcript. It seems clear to us that the Fed is nowhere near the conclusion that inflation is back under control and that further hikes will be needed, even at the cost of a mild recession and/or weakening labor market.”– writes John Velis, strategist at BNY Mellon.

Another great program

The week will depend on the monetary decisions of the Bank of Australia and the Bank of England, the meeting of OPEC, which is to decide on the development of production in September, as well as the report on July employment in the United States. state

Company releases will also continue with about 170 S&P 500 companies, starting with Activision Blizzard after Wall Street closes tonight, Capterpillar, AMD, Starbucks and Uber, not to mention Europe’s BP, Merck, BMW, Infineon, Bayer, Beiersdorf, Lufthansa and Asians Alibaba and Nintendo. In France, the five Cac 40 components will publish their quarterly reports; Bouygues, Axa, Société Générale, Veolia Environnement and Crédit Agricole.


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