(BFM Bourse) – The three-color flagship index, which managed to recover 1.7% last week, starts this in red as the results season kicks off in the coming days. While many uncertainties about the economic outlook persist, investors will be more attentive than ever to corporate talk.

The implementation of new distancing measures and travel restrictions in China amid the emergence of a BA.5 version of the Omicron variant set the tone for the first exchanges in Europe on Monday morning. Following in the footsteps of the Shanghai Composite (-1.5%), the CAC 40 lost more than 2% at the opening, but the Paris market cut losses in the morning. Around 12:00, the index settled at 5,991.03 points, down 0.7% since the last close.

Last week, the CAC 40 managed to rise 1.72% and the S&P 500 by 1.92%, an improvement in line with seasonality, meaning the first half of July is particularly lively for equities. .

“As stocks fell, credit spreads widened and global returns [des obligations NDLR, ce rendement augmentant à mesure que le prix baisse] it increased in the first half, it was only a matter of time before conditions tightened enough to slow growth to the point necessary to offset inflation. Unsurprisingly, nearly all market watchers are now predicting a recession and a decline in corporate earnings. However, investors are wondering how much inflation, tightening and slowing are already priced and if that’s enough, “said Robert Surgent, senior fund manager at Neuberger Berman. For the first time since the beginning of the year, the specialist believes that this could well be so … In any case “if prudence is a must in the next quarter, we do not think it appropriate to be more attentive to the markets than six months ago”, indicates Robert Surgent.

The tenor of the speech of business executives will obviously be decisive with respect to the 2022 objectives to verify whether the drop in prices in the first half of the year sufficiently reflects the difficulties linked to inflation, or if, on the contrary, a contraction in profits. requires further downward adjustment. This week the publications will start at the end of the first semester. A first salvo from the US is expected with PepsiCo on Tuesday or Delta Air Lines on Wednesday, followed by JPMorgan and Morgan Stanley on Thursday and then BlackRock, Citigroup and Wells Fargo on Friday. In the macroeconomic chapter, the release of the first inflation data for June in the US on Wednesday is the highlight of the week.

For the moment, animation is a bit lacking on the Parisian market with limited volumes, as was already the case on Friday. Long uncertain, STMicroelectronics raised 0.8% at noon when the group announced with great fanfare plans to build a new factory, shared with the American group GlobalFoundries, on its Crolles site.

With + 0.25%, Sanofi is also one of the few representatives of the CAC 40 in green after the success of a clinical study on fitusiran, a molecule against haemophilia acquired by Alnylam in 2018.

Among the small caps, Hoffmann Green Cement stands out with the acquisition of the Périgord ABC Broyage group, which allows it to internalize the processing of its raw materials. This very first takeover by the company was well received by investors, as the Hoffmann Green Cement stake gained 2.4%.

On the foreign exchange market, the euro is returning towards the low of more than twenty years touched last week below 1.01 dollars, at 1.0108 dollars (-0.79%). The price of oil again marked a sharp correction at 104.90 dollars (-1.98%) for the Brent barrel and 102.31 dollars (-2.35%) for the WTI.

Guillaume Bayre – © 2022 BFM Stock Exchange

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