(BFM Bourse) – The CAC 40 increased by 3.4% on Friday, bringing its weekly decline to -11.94%. This is the worst week on the Paris Stock Exchange since … November 2008, when the American economy faced the greatest financial crisis since 1929 after the fall of the bank Lehman Brothers.
Worse and worse. Already rolled on Thursday, the CAC 40 sank 3.38% on Friday – the fall even approached 4.5% at the worst of the session – and finished at 5.309.90 points. More than 9.7 billion euros were traded, an exceptional volume highlighting the massive nature of this fall. Added to the decreases in previous sessions, this brings the weekly decline in the Parisian index to -11.94%, the worst week since November 2008.
While the American indices sat a week ago at historic records, Wall Street was also heading for a weekly correction of more than 10%. The Dow Jones fell further 2.10% at the time of closing in Europe, while the Nasdaq Composite yielded “only” 0.8%. If the number of cases remains low in the United States, the federal agency of the Centers for Disease Control and Prevention (CDC) expects the virus to spread more widely soon. The CDC has also identified a first patient for whom the origin of the contamination could not be established.
The fall had been almost as violent in Asia. The Japanese Nikkei lost 3.67% and the Shanghai Composite 3.71%.
“A very difficult week”
In general, most of the world markets have now entered a zone conventionally qualified as a correction (i.e. a fall of at least 10% compared to a previous peak, but not more than 20%, the threshold at which evokes a bear market or “bear market”).
This Friday marks “the last day of a very difficult week and people [opérateurs de marché] don’t want to take any chances before the weekend, “said Peter Dixon, economist at Commerbank.” So preempt the damage – sell immediately and look at the consequences later, because no one is going to sanction you for being a seller in such a market “, indicates the economist to summarize the current state of mind of traders.
In the news of Parisian values - clearly passed in the background Friday – Veolia (-3.3%) reported a net share share up 41.8% to 625 million euros for of 2019.
Saint-Gobain lost 4.3% while the group multiplied its profit by 3.5 in 2019, to 1.4 billion euros, with an operating margin up 30 basis points to 8% for a turnover of 42.6 billion euros.
The Korian long-term care group faltered by 4.2%, after announcing a 10% improvement in its annual net profit.
Very rare stocks manage to stay in the green, including Rallye (+ 6.6%), the parent company of Casino, while according to Agefi the Paris Commercial Court should, barring a theatrical move, approve the plan of exit from safeguard procedure concocted under the aegis of the judicial administrators.
The specialist in liquefied natural gas storage systems GTT, after trying to accelerate up to almost 2%, the group having found no delay in the construction schedule of ships equipped with its technology, mainly built in the Korean shipyards, finally turned around (-4.4%) at the close. For the past financial year, GTT’s net profit reached 143.4 million euros, a slight increase of 0.4% compared to 2018.
Certain titles have however been highly sought after, insofar as they come from companies whose activity is potentially boosted by the coronavirus. The Franco-British biotech Novacyt soared 29.6% given a high demand for the test to detect the coronavirus designed by its subsidiary Primerdesign. The firm notably concluded distribution agreements with a large life sciences company and with a group specializing in diagnostics.
The industrialist UV Germi, who designs, manufactures (in Corrèze) and markets (to the Middle East) a system for disinfecting ambient air with ultraviolet light reaches a new historic peak, at more than 10 euros, in 32.5% increase.
Black gold is also in a “correction” situation, the spread of the coronavirus raising fears over demand for hydrocarbons. At the end of the day we witnessed a 5.1% collapse of the Texas WTI to 44.68 dollars, while Brent from the North Sea fell 4% to 49.65 dollars.
In full rebound for a week, in anticipation of further rate cuts by the Federal Reserve which would make the dollar less attractive, the euro stabilized at 1.10 dollars stack.
Guillaume Bayre – © 2020 BFM Bourse
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