(BFM Bourse) – While the Paris market was struggling mid-day after recording up to 5% gains around 10:30 am, the upward opening of the New York Stock Exchange has visibly reassured investors, the ACC gaining a little height at the end of the session.
Miracle on the Paris Stock Exchange. In the aftermath of one of the biggest increases in its history (+ 8.39%), the ACC managed to consolidate this rebound to which it added an additional progression of 4.47%, at the end of another particularly eventful session. In fact, the Paris barometer opened up 2.4% before increasing its initial gains until posting almost 5% increase at 10:30 a.m. … before returning to negative territory at 12 noon.
The flagship index of the Paris Stock Exchange then gradually picked up, before accelerating its rise at the opening of Wall Street and then very clearly shortly before the close, to finally close the session on Wednesday on a strong advance of 4.47% to 4.4332.70 points, in a trade volume supplied of 5.4 billion euros.
CAC now in “bull market”
As surprising as it may be, this net gain allows the ACC to technically enter the territory of a “bull market”, which therefore follows a violent “bear market”. The barometer of the Paris Stock Exchange indeed picks up 22.4% compared to its annual floor touched on Monday March 16 in session at 3.632 points, which testifies to the amplitude of the movements – and the extreme volatility which reigns – within the ACC.
The Parisian market had started the session well (+ 2.3%) “in the wake of the best day (Tuesday, note) for the Dow Jones since 1933, its strongest progression (in points) in its history and the most important volume never known, “noted John Plassard, investment specialist at Mirabaud in his morning note.
The Dow continues on its previous day’s momentum
The flagship Wall Street index, the Dow Jones Industrial Average soared 11.37% on Tuesday. You have to go back to March 15, 1933 to find traces of such a high percentage increase in one session. The Parisian market also took off on Tuesday, stimulated by the new burst of measures announced by the Fed, including in particular “an unlimited purchase of bonds as well as various mechanisms of direct assistance to businesses”, including SMEs.
“Icing on the cake, a compromise was signed overnight (Tuesday to Wednesday, editor’s note) between Democrats and Republicans on a plan to support the US economy of $ 2,000 billion in the face of the coronavirus pandemic”, a pointed out John Plassard. This recovery plan (the most massive in history) must now be adopted by the House of Representatives, controlled by the Democrats, before being promulgated by the American president.
Analyst at CMC Markets, Michael Hewson judges the market “more and more optimistic” on the action of governments. “Politicians are beginning to understand the scale of the economic downturn that is coming, as the death toll continues to rise in Europe and the United States.”
At 5:45 p.m., the New York Stock Exchange confirms its spectacular recovery the day before, with the Dow gaining another 4.7%, the S&P 3% and the Nasdaq 1.4%. The flagship Wall Street index is notably driven by the impressive rebound of Boeing (+ 32%), second weighting of the Dow, and by Nike (12%), the comma brand having pleasantly surprised the markets Tuesday after the close , reporting strong quarterly results. Note that like the Paris Stock Exchange, that of New York also opened in the green before falling into negative territory and then gaining height.
Banking and aeronautics rebound
Few news on the value front, except Lagardère (+ 11.6%) which suspends its 2020 forecasts and has proposed to reduce its dividend by 1.30 euros per share to bring it down to one euro, or Renault (+ 1.9%), which has announced the end of production at its seven sites in Latin America, which will restart when conditions allow.
Within the ACC, there is still a rebound in the banking sector, Societe Generale (+ 11.4%) dominating the ranking of the flagship index at midday, while Crédit Agricole (+ 5.5%) and BNP Paribas (+ 8%) are also taking a breath of fresh air. The surge in Safran (+ 18.9%, better performance of the index) is also to be noted, while Airbus (+ 7.2%) also offers a nice rebound
Total also picks up 7.8% despite the stagnation of crude oil prices, the barrel of Brent trading at 27.18 dollars (+ 0.11%) around 5:50 pm, when that of WTI picks up 1.71% at 24 , 42 dollars. Down sharply in the morning, the two world oil references picked up after the publication of US stocks which increased less than expected (+1.6 million barrels when the consensus was betting on +2.7 million ).
The luxury segment was also very buoyant, with increases of 7.2% for LVMH, 6.5% for L’Oréal and 5.3% for Kering (+ 2.4% “only” for Hermès).
Outside the flagship index, Solocal (+ 28%) continued its rebound (+ 58% since the start of the week), while SMCP (+ 14.6%), Natixis (+ 16.9%), Elior ( + 11.3%) or Euronext (+ 16.3%) rebound markedly
In Forex, the single currency is again gaining ground against the greenback (+ 0.42% to 1.0855 dollars) shortly before 6 p.m.
Quentin Soubranne – © 2020 BFM Bourse
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