“The Fed will avoid market panic”: the stock week starts in the red

Bourse fell 0.93% on Monday as investors were cautious ahead of a highly likely further significant rate hike by the Fed, the US central bank, on Wednesday. At 10:10 am, the CAC 40 stellar index rose 56.69 to 6020.61 after briefly falling below 6000 for the first time since July 15. It lost 1.31% on Friday, bringing its weekly loss to 2.17%.

Around 12:30 (10:30 GMT) Bel 20 Brussels Stock Exchange fell by 0.83% and amounted to 3562.38 points. Frankfurt Stock Exchange fell 0.90% to 12,626.99 points, and London Stock Exchange was closed on Monday in connection with the funeral of Elizabeth II.

The main event of the week, and already expected after the publication last Tuesday of data on stronger-than-expected inflation in the US in August, will be the meeting of the Fed’s monetary policy committee.

Housing prices, food prices and even new cars continued to rise in August in the US, the world’s largest economy, which at this stage shows only a few signs of a timid slowdown in demand.

The fight against inflation will go through a recession

“The discussion in the markets is whether the monetary policy committee will raise its key rates by 75 basis points next Wednesday should be kept.”

A small fraction of market operators expect an even stronger increase in the Fed’s key rate by one percentage point (100 basis points), but this hypothesis is “unlikely” for Sebastian Paris Horwitz. “The Fed will avoid panicking in the market and, above all, will not want to introduce even more severe shocks,” he said.

The fight against inflation, initiated by the American Institute, is likely to lead to an economic downturn and, consequently, lower corporate profits, which could lead to the stock market indices dropping to lows in June.

To hedge against this risk, investors sold at all costs, only Dassault Systèmes was higher in the CAC 40 around 10:05.

TF1 and M6 refuse marriage

The TF1 and M6 groups announced on Friday that they were abandoning their merger project, deeming it no longer represented “no industrial logic anymore” given the concessions the Antimonopoly Authority demanded of them, such as the sale of TF1 or Channel M6. The names TF1 (-3.19% to €6.23) and Métropole Télévision (-4.11% to €12.59) were at the bottom of the SBF 120 table, with TF1’s parent Bouygues selling 1.63% to 29.28 euros.

Termination of cooperation with Valneva

Franco-Austrian biotech lab Valneva announced on Friday that it was ending its partnership with biotech company IDT Biologika, which produced the active ingredient in its Covid-19 vaccine, due to the suspension of production of the vaccine after production cuts. European Commission directives. Valneva will pay IDT Biologika €36.2 million in compensation and equipment equivalent to €4.5 million.

Valneva shares fell 12.50% to 7.10 euros.

Laurent Mignon in Wendel

Laurent Mignon, head of French banking giant BPCE, will step down as president of the group’s executive board to take a seat at investment firm Wendel, which received 0.07% to €76.80.

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