The Paris Stock Exchange destroyed losses from the previous day, thanks to solid corporate publications, but, above all, the growth of Fed interest rates as expected. The US Federal Reserve was also less aggressive than expected in the future. The Bank of England will take office early in the afternoon. The repo rate is expected to rise by 25 basis points to 1%, the fourth increase since the end of 2021.
About 10:30 a.m. Bedroom 40 increased by 1.65% to 6,501.51 points with the expansion of business by 860 million euros.
The Fed, as expected, announced last night its first increase in the Fed’s rate by 50 basis points since 2000, to bring it between 0.75% and 1%. It also announced the launch of a process to reduce its balance sheet by more than $ 9,000 billion to $ 47.5 billion a month for three months and then double the amount to $ 95 billion. The tone of the press release, almost in line with March, is also less “hawkish” than one might fear, thus dispelling fears of a significant rate hike.
There is still no increase of 75 basis points
The Federal Reserve expects inflation to return to the 2% target without causing too much damage to the real economy and labor market. with a corresponding strengthening of monetary policy “She continued to choose ignore, as we expected, the reduction in GDP in the first quarter and maintain only a sharp increase in final sales to households and businesses “Says Paul Ashworth, chief economist at US Capital Economics.
During his press conference, Jerome Powell said last night that the Monetary Policy Committee plans to raise rates by 50 basis points at its next two meetings, in June and July, but it is ” did not actively consider »Increase by 75 basis points. At the same time he specified that in case of increase of the rate ” necessary, we do not hesitate to apply them “.
The Fed’s apparent moderation lifted Wall Street when the S&P 500 closed with a 3% increase, the largest session since May 2020, while the Nasdaq Composite erased its losses at the start of trading and won 3.2%, the best of 16 March.
Airbus and ArcelorMittal lead the Cac 40
Airbus jumped by 7.6%. The aircraft manufacturer has maintained its forecast for fiscal year 2022, and its financial results exceeded expectations by the end of March. Grouper also announced that it is preparing to increase the monthly production of the A320 family to 75 by 2025.
ArcelorMittal in advance by 4.6%. In the first quarter, the metallurgical producer improved its results, in particular, due to higher prices. But the group warned that a slight decline in world steel consumption could be expected this year.
Stellantis increases by 2%. The automaker reported a 12% increase in turnover to 41.5 billion euros in the first quarter. The Reuters consensus expected 36.9 billion euros. In the current financial year, the Group confirms that it expects double-digit adjusted operating margins and positive cash flow.
Perfectly rose by 2.9%. The electrical equipment manufacturer confirmed its financial goals for 2022 by publishing reports that exceeded analysts’ forecasts for the first quarter, earning a net profit of 258.3 million euros, or 13.3%. After him, Schneider-Electric gaining 3.1%.
Societe Generale an increase of 1.7%. Despite the uncertainty surrounding the war in Ukraine, the bank reported higher-than-expected profits in the first quarter. The share of the bank’s net profit reached 842 million euros against 814 million a year earlier. According to the FactSet consensus, analysts expected an average quarterly net profit of 337 million euros.
The biggest drop is in Cac 40, Agricultural credit loses 2.8%. The Green Bank recorded a 47.2% drop in net income to 552 million euros in the first quarter after recording more than half a billion euros in reserves on its accounts related to its risks in Russia and Ukraine.
Excluding the flagship index, Archema gaining 5.6%. The Specialized Chemicals Group raised its annual gross operating income (EBITDA) forecast for its specialty unit after publishing reliable first-quarter results, despite high inflation for raw materials and energy.