Cac 40, Market News, on the grip of a sharp increase in volatility after the first round of the presidential election

The Euronext Paris’s flagship index rose to 0.70%, rose 0.88% and then remained stable in the morning. Given that Emmanuel Macron slightly outperformed Marine Le Pen after the first round of the French presidential election, the market is in the midst of new volatility. This phenomenon can continue until the second round, or until the legislative elections on June 12th and 19th. Investors are also focusing on many key economic indicators and events that will inspire the week.

Just before 11:00 am Bedroom 40 With a transaction volume of about 700 million euros, it increased by 0.32% to 6,568.89 points.

On the securities side, banks are surrounded by narrowing yield spreads between the French 10-year OAT and the German American Bund with the same maturity at the end of the first round. Societe Generale It won 6% after the announcement of an agreement to sell the shares of Russian bank Rosbank and its insurance subsidiary. Among other financial stocks BNP Paribas 3% highly rated, AXA 2.4%. The financial sector can benefit short-term from the recovery of bailouts thanks to Emmanuel Macron’s initiative to strengthen European integration.

Same as above for highway concessionaires VinkMe and EiffageMarine Le Pen has proposed a renationalization of the highway, increasing 2.5% and 1.8%, respectively, after last week’s decline.

Bets are open in the second round

The retiring president has a small lead over the rival National Rally. This means that for many analysts, Marine Le Pen has never been so close to victory. According to some, the latter victory is considered anti-European and pro-Putin and can cause shock waves comparable to those caused by the 2016 Brexit victory. For Emmanuel Macron, the postponement of the vote from the left would be decisive given the score of Jean-Luc Melenchon, who finished third in the first round.

Within two weeks, the two candidates will decide which one to use and try to lay the groundwork for nature. In the forex market, the euro is stable at $ 1.0915, but Emmanuel Macron won 54% of the 46% of Marine Le Pen in the first vote of the second round.

Inflation, over and over again

The Asian market plunged this morning, with China’s CSI 300 and the Hong Kong Stock Exchange’s Hang Seng Index falling about 3% in response to a higher-than-expected rise in consumer prices (+ 1.5%) in March. However, especially those in production surged 8.3%. The long-term imprisonment of the city of Shanghai and the consequent suspension of certain activities also emphasizes this trend.

Attention is strengthened by expecting the European Central Bank’s board to meet on Thursday. Inflation remains a central concern, with widespread expectations for a more aggressive shift in monetary policy, whether it is the early termination of asset purchase programs or the temptation to raise interest rates.

Inflation will still be a problem in the US with consumer price indexes for March. According to a consensus formed by Bloomberg, it could increase by 8.4% in a year or hit a new high in 40 years. In the bond market, US 10-year bond yields exceeded 2.75% for the first time since March 2019.

Start of first quarter earnings season

The situation in Ukraine continues to plague the market, especially with sanctions on Russian hydrocarbons. The European Union’s foreign ministers will meet in Luxembourg on Monday, but it is unlikely that an agreement will be reached on Russia’s oil and gas embargo.

The next few days are also the beginning of the first quarter results season, especially for major US banks. In France, the three components of Cac 40, LVMH tomorrow evening, followed by Hermes and Publicis quarterly sales will be revealed.