Cac 40: Stock market releases bile in the face of accumulating sanctions against Russia

(BFM Exchange) – Banking, auto and aviation stocks, especially the CAC 40, weighed by those most exposed to Russia, have erased their recovery in the last two sessions after the announcement of new sanctions against Russia.

Having managed to get out of its “range” of about 6,600 points last Tuesday to return to its pre-Russian invasion of Ukraine, the CAC 40 was back by around 100 points on Tuesday, still against the background of the evolution of the war and the associated sanctions against Moscow. . After two sessions of gains on Friday (+0.37%) and Monday (+0.70%), Paris’ barometer dropped 1.28% this Tuesday to 6,645.21 points. billion during the session).

“It’s a transition week for the Paris Stock Exchange. Major economic announcements are scheduled for next week (inflation in the United States, European Central Bank meeting, etc.),” ​​says Christopher Dembik, director of macroeconomics research at Saxo. Bank. “Despite the recovery in tech-related stocks in the United States, European indices should open this morning with no real trend, as investors have decided to ‘put aside’ the war in Ukraine for the time being,” John Plassard said. In the morning note, Deputy Director of Investments at Mirabaud. In fact, the CAC 40 moved close to equilibrium until 10am before turning red. The expert still wonders how long operators will ignore information from Ukraine.

An element of backlash emerged that afternoon, with the announcement of new international sanctions in response to this week’s discovery of massacres of civilians attributed to the Russian military in several cities on the outskirts of Kiev, including Boutcha. The US has banned Russia from paying its debt with dollars held in US banks from Tuesday, increasing the pressure on Moscow and increasing the risk of Russia defaulting. At the same time, the European Commission proposed to the 27th Tuesday that sanctions against Moscow be toughened by halting purchases of Russian coal, which represents 45% of EU imports, and closing European ports to Russian ships.

These new economic retaliations have prompted investors to once again abandon the most exposed French stocks to Russia, particularly Renault (-6.2%) and Société Générale (-5.7%).

In terms of statistics, investors got their PMI index (from the survey conducted by IHS Markit and S&P Global) on private sector activity in the euro area on Tuesday morning. In France, this indicator stayed at 57.4 in March, in line with the “flash” forecast after 55.5 in February – the 50 mark threshold, the border between expansion and contraction, as a reminder. “Industry growth accelerated in March, the recent lifting of health restrictions, particularly the abandonment of the ‘vaccine transition’, bolstered activity and stimulated demand,” said Joe Hayes, senior economist at S&P Global. The same observation is in the eurozone, where activity in services has been bolstered by the lifting of measures linked to the pandemic. However, the survey indicates that the recovery seen in March is threatened by rising energy costs due to the occupation of Ukraine by the Russian army.

Unpaid bank securities

There is little news to report on the securities front in Paris this Tuesday, a week before the “official” launch of a new results season for the first quarter of 2022, specifically LVMH on Tuesday and Hermès on Thursday.

By industry, struggling banking stocks (still) this Tuesday mid-day, Crédit Agricole (which was penalized by a change in AlphaValue’s recommendation) and BNP Paribas, posted returns of 5% and 4.6%, respectively, after Societe Generale. Another increase in bond yields. STMicro also owns semiconductors specialist factories in Isère and rival Soitec (-3.7%).

Among other sharp declines, Veolia fell 5.3% and the aviation sector led the wing (-4.4% for Airbus, -3.2% for Safran). Saint Gobain and Stellantis yielded 4.3 percent and 3.7 percent returns.

Orpea is making headlines again after 80 complaints from residents’ families to the Nanterre prosecutor’s office against the pension giant accused of “endangering others” and “murdering” on Monday. The title fell 6.1%, once again dragging his opponent Korian’s after him (-3.2%).

Among the smallest values, Medesis Pharma increased by 127% (!) after taking stock of its treatments for large populations contaminated or exposed to radiation after a civilian or military nuclear accident.

Oil changes little

Oil prices are hesitant on Tuesday, hovering between red and green, as the EU discusses new sanctions against Moscow, the Commission offered 27 to stop purchases of Russian coal, but remains undecided on black gold for now. Brent crude, which rose in the morning, thus fell slightly (-0.3% to $107.2) around 18:10.

Finally, in the foreign exchange market, the single currency continues its steep decline in the last three days, falling below the $1.10 threshold, and regressed to $1.0919 with an additional 0.50% decline.

Quentin Soubranne – ©2022 BFM Exchange