AFP, published Monday 11 July 2022 at 09:58
The fear of seeing part of China again paralyzed by health restrictions against Covid-19 weakened the Paris stock exchange on Monday (-1.44%), especially luxury stocks, heavyweights of the index.
The CAC 40 stellar index dropped 86.82 points to 5,946.31 points around 9:40 am. On Friday, it closed 0.44% higher at 6,033.13 points, an increase of 1.72% for the full week.
In many places in China, signs of a resumption of the epidemic appear and represent a threat to economic activity, the country maintains its strict health policy against Covid-19.
Macau began its first lockdown since the start of the pandemic on Monday, to stem its worst coronavirus wave. Residents have the right to leave the house only to purchase basic necessities and to be tested.
The government of Hong Kong, near Macau, is considering adopting the same system, the city’s new health minister announced on Monday.
For its part, “Shanghai reported its first case of the highly contagious BA.5 Omicron sub-variant on Sunday,” note analysts at Deutsche Bank.
Europe is also weakened by the tensions on the gas market. Russian giant Gazprom begins maintenance work on the two Nord Stream 1 gas pipelines in the morning, which transport a large amount of its gas still delivered to Germany and several other Western European countries, but observers fear that the pipeline may remain closed much longer than the expected 10 working days.
The French government then called on Sunday to “quickly get in order” to address the possibility of a total cut in Russian gas supplies, “the most likely option” according to Economy Minister Bruno Le Mayor.
The price of European natural gas, the Dutch TTF, fell 5.26% to 166 euros per megawatt hour, not enough to offset last week’s nearly 15% jump.
Luxury stocks, heavyweights of the Paris rating, dragged the rating down with fears in China, one of their main markets. LVMH sold 2.77% for € 590.30, Kering 2.27% for € 489.65 and Hermès 1.21% for € 1,057.
Mining company ArcelorMittal, also dependent on Chinese demand, fell 4.25% to € 20.93.
New plant for STMicroelectronics
The Franco-Italian semiconductor manufacturer will build, with the American GlobalFoundries, a plant in Crolles, near Grenoble, to produce semiconductors, an estimated investment, according to the two companies and the French government, of 5.7 billion euros. The stock lost 1.12% to € 30.49.
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