Cac 40 fell more than 1%, ECB to raise rates in July and then may accelerate, market news

The Paris Stock Exchange fell after the confirmation by the Board of Governors of the European Central Bank of the termination from July 1 of the purchase of assets under the APP. The ECB also plans to raise interest rates by a quarter of a point at its July 21 meeting, for the first time in 11 years. But above all, she pointed out that if medium-term inflation forecasts “confirm or worsen, tightening is appropriate in September “Also, a gradual but steady increase in interest rates would be appropriate,” she added.

When asked by Reuters, which is trying to find out if all ECB interest rates were affected by the upcoming tightening of monetary policy, Christine Lagarde answered in English that these are “ECB key interest rates”, emphasizing them. She also confirmed that the ECB is about to emerge from the era of negative interest rates. On the foreign exchange market, the euro lost 0.3% to $1.0684.

around 3:45 p.m. Bedroom 40 lost 1.46% to 6354.39 points with a business volume of 1.49 billion euros. In New York Dow Jones gives 0.34% and NASDAQ Composite 0.73%.

Inflation forecasts revised upward

The long-awaited announcement to stop buying assets had no effect on the markets. Nonetheless, “The most important element of a press release is that it doesn’t say, says Andrew Kenningham of Capital Economics. ” There is absolutely nothing new in the possible “anti-fragmentation tool” aims to avoid excessive widening of the yield spread in peripheral countries “, – he notes. While in May, consumer prices in the eurozone reached a record 8.1% for the year, the ECB expects inflation this year to be 6.8% against 5.1% in March, and then fall to 3.5% in 2023 (revised from 2.1%) and to 2.1% in 2024 (compared to 1.9% previously) As for the GDP growth forecast, it is lowered from 3, 7% to 2.8% for this year, from 2.8% to 2.1% for 2023 and raised from 1.6% to 2.1% for 2024.

High price for the global economy

While investors are trying to gauge the scope and pace of the central bank’s upcoming monetary tightening, they are also waiting for May US inflation data to be released tomorrow. According to the consensus formed by Bloomberg, they should have stabilized at 8.3% during the year. In the bond market, the yield on 10-year US bonds fell 3 basis points to 3.0520%.

Yesterday, the OECD warned of risks to the global economy that are expected to pay a high price for the war in Ukraine in the form of lower growth, higher inflation and potentially long-term damage to supply chains.

Two options for the nationalization of EDF are being considered

The biggest increase in SRD, EDO increased by 4.7%. The nationalization of the electrician is one of the priority projects of the new government, which will be implemented after the legislative elections, the report said. Echo. The state, which owns 84% ​​of the group’s capital, is exploring two options: either through a simplified public offer for minority shareholders, or through a nationalization bill, daily points out.

Sodexo stable. HSBC upgraded the catering company’s stock from Hold to Buy. The same broker downgraded the rating Elior (-3.7%) from “buy” to “hold” and reduce the target price from 7.50 to 3 euros.

get the link fell 2.5% despite a tripling in passenger traffic in May. RBC maintains its “undervalued” view of the stock, believing that the volatile aspect of gaining market share does not favor the upside of results or their current valuation, which is “significantly” overvalued by speculative M&A deals.