The Paris Stock Exchange ended on a substantial rebound of more than 2% on Friday, thus managing to end on a positive note a turbulent weekly course due to a lot of uncertainty about global growth.
The CAC 40 index gained 2.52% over the session and 1.67% over the week, which had however started badly.
“A lot of fears have accumulated this week: fear that the monetary tightening of the American Federal Reserve will end up causing a recession, concern about the war in Ukraine, the end of which we do not really see, and that relating to confinements in China and the supply problems,” commented Lionel Melka, director of research at Homa Capital, interviewed by AFP.
“Today, the market wanted to go up. This technical rebound was helped by comments from Jerome Powell and news from China deemed encouraging “on the health front, explains the expert. But, he insists, “the current subject is inflation”.
The head of the American central bank (Fed) said he was in favor of two hikes of 0.5 percentage points at the next two meetings of the institution “if the economy evolves as expected” and, according to Bloomberg, he has reaffirmed that the Fed was not considering a 0.75 point rate hike, which reassured investors.
The institution is facing an “extraordinarily difficult exercise to manage to curb inflation, (and) raise rates without causing too much turbulence” on the markets, observes Mr. Melka: “the market believes that if the Fed hits too hard to break inflation, then we will have a recession, but if the Fed does not do enough, then inflation will end up killing consumption” and leading to a recession.
Fall in Orpea’s profit
The group of private nursing homes Orpea, in turmoil since the release in January of a book-investigation, announced that it had signed an agreement with its banks to ensure its financing in the face of the uncertainties weighing on the company, after a plunge of nearly 60% of its annual net profit. After falling more than 5% at the start of the session, the stock caught up to end up 2.93%. Since the beginning of the year, it has lost more than 60%.