The Paris Bourse is at its highest since mid-March after a rebound of more than 20% from its low point hit on the 13th of last month. Signs of the slowdown in the spread of the coronavirus pandemic in several countries are bringing some calm to the markets. US index futures are also advancing, as the dollar gives ground against other currencies, a sign that fears about funding are easing. The yield on government bonds in Europe and the United States is also trending upward.
« Markets can now hope for a potentially better future, despite economic indicators that remain poor, with US equities still attractive compared to the start of the year. The rally could continue Says Chris Beauchamp, chief market analyst at IG.
At 2:45 p.m., le Cac 40 gained 3.05% to 4,478.60 points in a business volume of 1.85 billion euros. Elsewhere in Europe, the Footsie Londoner up 2.59%, the Dax of the Frankfurt Stock Exchange by 3.64% and the FTSE Mib Milanese by 3.35%. The contract future June on index Dow Jones advance of 790 points (+ 3.51%).
Towards an epidemic plateau?
The fact that the spread of the coronavirus appears to have reached a plateau, if not a peak, in several European and Asian countries, as well as in New York, raises many hopes. New York State Governor Andrew Cuomo said he saw the death rate remained stable over the past two days, as it declined in Italy. But the number of cases continues to increase in Spain, where it reached 140,510 on Tuesday. In France, the epidemic ” is still in the worsening phase », Declared the Minister of Health, Olivier Véran.
The number of people infected exceeds 1.36 million worldwide, and the number of deaths is close to 76,000, according to the latest data compiled by Johns Hopkins University on Tuesday. This prompts analysts to remain cautious, especially as the earnings season promises to be delicate in the United States, as in Europe, and that the suspensions of forecasts and / or corporate dividends are increasing.
Boris Johnson’s placement in intensive care last night also sounds like a reality check of the pandemic. The prime minister is on oxygen, but has not been placed on life support, according to the BBC. Foreign Minister Dominic Raab will act as interim minister during the hospitalization of the head of government.
A Eurogroup under pressure
Governments are continuing their efforts to limit the economic impact of the pandemic. Japan has stepped up its support plan by 168 trillion yen (nearly 150 billion euros), the United States is also about to increase theirs, while Germany is preparing to announce the granting of credit facilities ” unlimited For small and medium-sized businesses.
But attention is now focused on the teleconference of the finance ministers of the Eurogroup, intended to try to find common solutions to deal with the situation. One thing is certain, the issue of coronabonds emissions will not be addressed given the opposition of several member countries. Instead, ministers are likely to debate lines of credit under the European Stability Mechanism (ESM), although the issue may upset some given Italy’s level of debt, in particular.
Accor and Air France still in sight
The barrel of Brent rose 1.7% to 33.62 dollars in the hope of an agreement to reduce production between members of OPEC + in order to put an end to the price war. But most of them condition an agreement on a decline from the American producers. An OPEC + conference is scheduled for Friday, and the issue should also be debated at the G20 scheduled for this weekend.
At the European level, the Stoxx 600 for leisure travel is at the top of the list with an increase of 7.8%. Accor thus gains 8.5% and Air France-KLM 4.6%. Aeronautics is also surrounded with the image ofAirbus (+ 8.3%) and Safran (+ 9.2%). The automobile industry is not to be outdone (+ 4.5%), Peugeot gaining 8.2%.
A l’inverse, Carrefour (-2.5%) is taking profit after gaining more than 1-% since March 13. same for me bioMérieux, which is down 5% after a 30% jump in two weeks.
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