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The CAC 40 has posted a record rise since the first quarter of 2022. Flirting around 7300 points, the market has benefited greatly from the good health of the luxury goods sector. However, persistent fears about inflation, which are expected to maintain the restrictive policy of the U.S. Central Bank, are hovering over its future evolution.
After more than 13 months, the CAC 40 has reached record highs. The Paris Stock Exchange index is still up on Wednesday. Shortly after 2:30 p.m., it was up 0.90% to 7278.40 points. An hour earlier, the CAC 40 had peaked at 7318.78 points, less than 1% off its record high of January 5, 2022 (7384.86).
The Paris stock market index is therefore holding at around 7300 points despite a context marked by persistent fears about inflation and the extension of the rate hike cycle. This buoyant momentum is largely attributable to the strength of luxury goods stocks. But the rise of the CAC 40 is also a repercussion of the Chinese central bank’s decision to inject new liquidity into the financial system. This is to meet the strong demand for credit after the end of health restrictions.
Luxury goods sector buoyant
The market is benefiting primarily from the firmness of luxury goods stocks. Down nearly 5% at the worst of the session, the French luxury group Kering, which published its results this morning, finally gained 2.2%. Kering’s CFO, Jean-Marc Duplaix, reported that the start of the year has been “very encouraging” in China. With a 7% drop in sales in the fourth quarter, Kering has nevertheless experienced difficulties that have particularly affected its flagship brand Gucci. Its sales of the brand have fallen by 14% like-for-like in the last quarter, very affected by a Chinese market then still at half-mast.
The LVMH share price rose by 1.4%. The announcement the day before of the appointment of the artist Pharell Williams as artistic director of men’s fashion at Louis Vuitton is probably not unrelated. Another signal probably dear to investors: according to Reuters, Louis Vuitton should increase its prices by up to 20% on the Chinese market, where it expects a strong rebound.
For its part, Hermès shares are also up 1.4%.
Uncertainties
However, the market is still undecided about the impact on monetary policies, after inflation in the US did not slow down in January as much as expected, remaining at 6.4% year-on-year after 6.5% the previous month. With the situation so uncertain, the Federal Reserve is expected to continue its monetary tightening cycle.
Reacting to the figures, Richmond Fed President Thomas Barkin said on Bloomberg TV that the central bank may have to “do more” to combat rising prices. Philadelphia Fed President Patrick Harker said monetary policy is on the verge of becoming sufficiently restrictive, but “we’re not there yet.
The fear of persistent inflation should therefore logically lead to a prolonged increase in the Fed’s interest rates. Christine Lagarde will also be heard this afternoon by European parliamentarians on the ECB’s 2022 annual report, a meeting that will be followed by investors.
Read also >Kering decelerated in the last quarter of 2022
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The CAC 40 has posted a record rise since the first quarter of 2022. Flirting around 7300 points, the market has benefited greatly from the good health of the luxury goods sector. However, persistent fears about inflation, which are expected to maintain the restrictive policy of the U.S. Central Bank, are hovering over its future evolution.
After more than 13 months, the CAC 40 has reached record highs. The Paris Stock Exchange index is still up on Wednesday. Shortly after 2:30 p.m., it was up 0.90% to 7278.40 points. An hour earlier, the CAC 40 had peaked at 7318.78 points, less than 1% off its record high of January 5, 2022 (7384.86).
The Paris stock market index is therefore holding at around 7300 points despite a context marked by persistent fears about inflation and the extension of the rate hike cycle. This buoyant momentum is largely attributable to the strength of luxury goods stocks. But the rise of the CAC 40 is also a repercussion of the Chinese central bank’s decision to inject new liquidity into the financial system. This is to meet the strong demand for credit after the end of health restrictions.
Luxury goods sector buoyant
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The CAC 40 has posted a record rise since the first quarter of 2022. Flirting around 7300 points, the market has benefited greatly from the good health of the luxury goods sector. However, persistent fears about inflation, which are expected to maintain the restrictive policy of the U.S. Central Bank, are hovering over its future evolution.
After more than 13 months, the CAC 40 has reached record highs. The Paris Stock Exchange index is still up on Wednesday. Shortly after 2:30 p.m., it was up 0.90% to 7278.40 points. An hour earlier, the CAC 40 had peaked at 7318.78 points, less than 1% off its record high of January 5, 2022 (7384.86).
The Paris stock market index is therefore holding at around 7300 points despite a context marked by persistent fears about inflation and the extension of the rate hike cycle. This buoyant momentum is largely attributable to the strength of luxury goods stocks. But the rise of the CAC 40 is also a repercussion of the Chinese central bank’s decision to inject new liquidity into the financial system. This is to meet the strong demand for credit after the end of health restrictions.
Luxury goods sector buoyant
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