The Paris Stock Exchange is evolving on almost three-month highs, wiping out half of the losses accumulated since the bear market phase that began in February. Wall Street progresses timidly in the first exchanges. The rally remains driven by the gradual resumption of activity without worsening the coronavirus epidemic and by measures taken by governments and central banks. The market hopes in particular a strengthening of the support plan of the ECB, the famous PEPP (Pandemic Emergency Purchase Program), currently endowed with 750 billion euros, Thursday on the occasion of the Governing Council. So many perspectives that take precedence over the Sino-American tensions and the threats of Donald Trump to send the troop to put an end to the violence in the United States after the death of George Floyd, an Afro-American killed by a white police officer.
This return to risk appetite comes at a time " where the internal situation in the United States seems to be deteriorating, but a market-focused look could retort that this at least distracts the president from his quarrel with China, which limits the probability of a resumption of the trade war, the less until the riots subside "Comments Chris Beauchamp, chief market analyst at IG.
Michael Hewson of CMC Markets believes that the longer term trend is to reduce restrictions worldwide, but if urban violence persists in the United States, " US investors will face a different kind of confinement, imposed by the National Guard "
At 3:45 p.m. Cac 40 rose 1.87% to 4,851.89 points, its first crossing above the 4,800 threshold since March 10, in a business volume of 2.2 billion euros. In Frankfurt, closed yesterday for Pentecost, Dax was 3.40% just below 12,000 points, a level not seen for three months. In New York, the Dow Jones takes 0.41%, while the Nasdaq Composite yields 0.14%.
Trump threatens to deploy army
Donald Trump threatened yesterday to deploy the army in cities or states that would not take the necessary measures to defend the safety and property of their inhabitants. He also described the attacks against the police during the protests as acts of terror. The chief executive, who defines himself as president " of law and order "Was speaking as police fired tear gas and rubber bullets at demonstrators gathered in Lafayette Square, a public park across from the White House. Muriel Bowser, the mayor of Washington DC, castigated federal police aggression against peaceful protesters 25 minutes before the 7:00 p.m. curfew came into effect.
Towards a contraction of 11% of France's GDP
If no major macroeconomic indicator is programmed this Tuesday, Bruno Le Maire announced that the government is now counting on a contraction of 11% of France’s GDP this year, against a previously estimated decline of 8%. He also indicated that the aid measures put in place at the start of the health crisis will be maintained and extended.
In Germany, Angela Merkel will try to obtain the agreement of the ruling coalition parties on Tuesday for a second support plan of between 50 and 100 billion euros, reports Bloomberg, citing sources familiar with the discussions.
Unibail tops Cac 40, TF1 in sight
Biggest rise in Cac 40, Unibail-Rodamco-Westfield progresses by more than 12%. The group announced the reopening of 65 of its 90 shopping centers. After the resumption of activity in its centers in Spain on June 8, and those in London on June 15, the group expects to have at least 87% of its shopping centers open by June 15.
Peugeot and Renault earn around 2%. Goldman Sachs noted the automotive Stoxx 600 from "underweight" to "neutral", pointing out that this high beta sector generally outperforms during sector rotations. It should also benefit from state support plans, adds the broker.
Fourth capitalization of the Cac 40, Total rises 3.5% in the wake of the rise in Brent prices, boosted by the anticipation of an extension of the production reduction agreement between OPEC and its allies.
Saint Gobain appreciates 4%, supported by a recommendation from JPMorgan, gone from "neutral" to "overweight" on the title of the manufacturer of construction materials. Among other analyst ratings, Societe Generale went from "neutral" to "outperformance" on Sodexo, which takes 4.9%.
Finally, TF1 7.8% advance after the signing of a partnership agreement with the Spanish company Mediapro for the creation of the Telefoot channel in France. As of August 2020, Telefoot will offer exclusive live broadcasting of more than 80% of Ligue 1 games.