If a bright sun still shines on the capital, the Paris stock exchange, up 1.3% on Tuesday, saw the passage of a few clouds and ended down 1.2%, at 6,352.94 points. The consolidation took place in a transaction volume of 3.4 billion euros. The two indicators published in the morning, linked to inflation, the “hot” topic of the moment, had no impact on the trend. They both confirm the soaring price movement.
In the UK, the consumer price index jumped 9% year on year in April, hitting a 40-year high, mainly due to rising energy prices. At the end of March, the inflation rate stood at 7%, specifies the National Statistics Office (ONS). In the euro zone, inflation was revised to 7.4% in April, but this is the thickness of the line since the initial estimate was 7.5%. Here again, energy prices are in question, but services, food, tobacco and industrial goods are also bearing the brunt of inflation. The market is now wondering about the impact of inflation and all-out increases in costs (salaries, freight, fuel) on company margins.
In the United States, the distributor Target saw its profits fall by half in the first quarter. On the stock market, the major indices are also raising the red flag, Dow Jonesthe managers’ benchmark index, dropping 2.3% and the Nasdaq Composite, focused on technology stocks, dropping 2.9%. Microsoft, Apple, Alphabet, Meta Platforms, Tesla and Amazon lost 2.3% to 5%, with the rise in the yield of ten-year Treasuries heading towards 3%.
In an interview at wall street journalthe head of the United States Federal Reserve (Fed), Jerome Powell, repeated that this the market already knows, namely that the institution will continue to tighten its monetary policy to counter inflation, which only slowed very slightly in April, to 8.3% over one year. It will support any necessary interest rate hikes until targets start to be met,” there will be no hesitation about it “, he hammered. In addition to inflation, the health situation in China continues to cause concern. Cases of Covid-19 contamination are increasing in Beijing, reports the Bloomberg news agency, which could lead to the implementation of additional restriction measures.
On the values front, Air France-KLM was among the biggest risers in the SRD thanks to a 4.87% gain. The air carrier announced a long-term partnership in cargo with maritime container ship operator CMA CGM, which could take up to 9% of the company’s capital in the event of fundraising. Also well oriented, the stock market operator Euronext gained 3.85% after the publication of record sales on March 31 at 395.7 million euros. Net profit, up 50.3%, rose to 164.4 million, after the integration of Borsa Italiana.
New Orpea scandal?
Conversely, Orpea is in trouble again. The title of the manager of retirement homes collapsed by 19.17%, after being suspended from trading. In question: an investigation by Mediapart and a collective of Investigate Europe journalists. They indicate that the Luxembourg holding company Lipany, created in 2007 and on which Orpea relied, has ” carried out several dubious financial operations, and recovered, through its forty subsidiaries, 92 million euros in assets in four European countries, including France “.
On his side Elior ended a small drop of 0.98%, after falling 10% at the open. If the activity of the community catering group rebounded in the first half of its staggered 2021-2022 financial yearinflationary pressures weigh on operating margins, already degraded by the Covid-19 pandemic. The customer loyalty rate is not going up, no dividend will be paid for this financial year and the new objectives have been disappointing.