Dow Jones continues to make corrections. In early February the Dow Jones index has made a correction, up to 5 days later experienced an increasingly large selloff. 1 February 2018, the Paris Bourse limits a little the breakage at the end of the course but the CAC40 yields -0.87% to 5.474 (against 5.465 at the lowest), the euro-Stoxx50 loose -0.9% to 3.610.
At mid-session, the US indices are widening their losses with -1% on average on the S & P500 and the Nasdaq and -1.5% the Dow Jones (led by United health and Pfizer with -4%): it is the most strong intraday correction since September 5 and 48H (-1.7%) since mid-August.
The Asian places had set the tone this morning with Shanghai -1%, Taiwan -1.3%, Tokyo -1.45%.
While the end of the month has ended for 14 months by closing at the highest: it is the first significant hitch on Wall Street and in Europe since the election of Donald Trump.
The CAC40 falls below 5,500Pts (at 5,474) despite encouraging figures for French GDP and then that of the Eurozone, which rose respectively + 0.6% in the fourth quarter in first estimate.
French GDP growth reached 1.9% in 2017 thanks to a dynamic fourth quarter (+ 0.6%, same pace as in the Euro zone), in the Eurozone, it stood at + 2.7%.
German inflation for January slows by -0.1% (the rise of the euro produces its effect), + 1.6% year-on-year, and + 1.4% in ‘HICP’ (harmonized rhythm in European level).
The fall of Wall Street has nothing to do with the price of housing in the United States, unchanged at + 6.4% in November
The Conference Board consumer confidence index beat the consensus for the same month of January with a +2.3Pts increase to 125.4 against 123.1. It remains to be discovered and Donald Trump’s speech on ‘the state of the Union’. The Dollar remains volatile: it dropped to 1.2450 at midday before recovering to 1.2400 (-0.1%). Boosted by growth on the old continent, the single currency rallies sharply, + 0.5% to 1.2440 / $, while the barrel of WTI, once is not custom compensates for the decline of $ and down -1.9% to $ 64.3 on the NYMEX.
Lastly, on the securities side, the oil companies suffered from the relapse of ‘gross’ and Total Loose -1.7%, Technip-FMC closed the market with -2.9% (same sanction for Vallourec within the SBF-120 ). Heavy banking with banks including BNP-Paribas (-1.7%) and Credit Agricole (-1.5%) and AXA (-2%). Symmetrically, the 2.4% rise in the Diaxonhit share, surrounded by the announcement of a 55% growth in annual sales, will be signaled symmetrically. Within the SBF-120 Elis loose 1.8% despite a 2017 turnover up 46% (+ 2.4% organic), Elior drops -1.9%, Eramet closes the march with -3.7%. JCDecaux and Manitou’s annual turnover will also be disclosed after the stock market and Kaufman & Broad’s 2017 results.
5 February 2018 The New York Stock Exchange moves on an almost sluggish note Tuesday morning, the day after a historic correction that saw the Dow Jones plummet a time of more than 6%. An hour after the start of trading, the Dow Jones is down 0.3% to 24,264.5 points, after falling 2% at the opening, while the Nasdaq Composite advance of 0.6% to 7012 ,3 points. This return to normal, or almost, is favored by the clear relaxation of the bond compartment.
After peaking at 2.88% on Friday, the 10-year US yield returned to 2.70% on Tuesday. The reassuring comments of the big market strategists also help to find some semblance of serenity. ‘There is no need to panic after the recent stock market correction’, says Lukas Daalder at Robeco. ‘The plunge in global markets is just the realization of a long-overdue correction,’ he adds. ‘This seller movement should generate a medium-term purchase opportunity’, says the professional.
And while some draw parallels with the stock market crash of 1987 (rising rates, high valuations and a high amount of algorithmic trading), they exclude such a black scenario. ‘We will probably see more volatility in the coming days’, warns Hartwig Kos, at SYZ Asset Management, ‘But if the dashboard is the same as that of 1987, great shopping opportunities could arise,’ he adds.
Note also that the trade deficit of the United States has further worsened in December 2017, according to the Commerce Department, to 53.1 billion dollars, where economists on average expected that a digging to 52 , 1 billion.