The Paris stock exchange rebounded on Wednesday, reassured by European Central Bank data after a surprise meeting on borrowing conditions in the euro zone.
The CAC 40 index rose 1.35 percent to 6,030.13 points, after six sessions of decline.
The European Central Bank has instructed its teams to expedite the design of a new anti-fragmentation tool to combat excessive interest rate differentials between northern and southern eurozone countries.
The corporation has also promised to apply a certain amount of flexibility in reinvesting bonds held under its Pandemic Emergency Program (PEPP).
These announcements, which were made after an extraordinary meeting of its board of directors, reassured the market because it means that the European Central Bank aims to fight inflation but takes into account what is happening in the financial market and especially borrowing rates, comments Ilana Azuelos. -Bossard, Deputy Director of Kiplink Finance.
Ilana Azuelos-Bossard adds that the European Central Bank is concerned about high borrowing rates, particularly those of highly indebted countries, such as Italy.
In fact, the bond market has been very tight for several days.
In one week, the French 10-year debt ratio rose from 1.8% to 2.4% on Tuesday and Italian debt simultaneously jumped from 3.4% to 4.18%.
The same trend on the side of differences, the gap between the rate of one country and that of another indicates, in this case Germany relative to Europe, which has clearly increased.
This suggests that the specter of price fragmentation in the eurozone is becoming more apparent, says Kiplink Finance analyst.
Interest rates fell sharply after the European Central Bank’s comments on Wednesday.
Meanwhile, investors are still waiting for the monetary tightening announcements from the US Federal Reserve in the evening.
The option for a 50 basis point rate hike hasn’t completely disappeared from the radar, but the hypothesis of 75 basis point or even 100 basis point inflation in recent days following the publication of the acceleration in US consumer price inflation in May.
The funders are leaving
Electricity and gas: reduce your bill with Online comparison
Shares in the banking and insurance sectors recovered after having struggled a lot at the start of the week on recession fears. AXA shares rose 2.97% to 23.06 euros, Credit Agricole rose 2.48% to 9.05 euros, BNP Paribas rose 2.01% to 48.29 euros, and Societe Generale rose 2.86% to 23.06 euros.
EDF in height
EDF acquired 3.43 percent of 8.44 euros. The Minister for Energy Transition, Agns Pannier-Runacher, said Tuesday that the re-nationalization of the EDF to enable it to build new nuclear reactors had not yet been determined, but not ruled out.
The EDF’s Central CSE (CSEC) also estimated that the EDF would not go beyond the end of the year if the government maintained measures put in place as part of the tariff shield to contain the rising bill.
Green Acquisition of TotalEnergies
TotalEnergies (-1.02% to €53.53) announced that it has acquired 49% of the shares of Compagnie des Bois du Gabon (CBG) and 600.00 hectares of forest, which the oil and gas group wants to withdraw carbon credits to offset. greenhouse gas emissions.