(AOF) – European equity markets closed in the red, penalized by fears of monetary tightening in the United States and the resurgence of the pandemic in Europe. The CAC 40 lost 0.85% to 7,044.62 points. The Euro Stoxx 50 fell 1.09% to 4,291.23 points. In the United States, the indices move in dispersed order at the end of the afternoon. The Dow Jones grabs 0.04% while the Nasdaq loses more than 1%.
The results of the European stock markets today could have been even more negative. The session, in fact, started badly with a CAC 40 down 1.4% early in the morning. Investor risk aversion was driven by two factors.
First, the reappointment of Jerome Powell at the head of the Fed. Investors fear that the president of the central bank will start his second term with a faster-than-expected tightening of his monetary policy in order to curb persistent inflation.
After having been an exceptionally “dove” central banker because of the pandemic, this moderate Republican could be tempted to (re) win the camp of the “hawks”.
Proof that this scenario is considered credible, the yield on the US ten-year rate jumped more than 12 basis points to 1.663%, its highest level in a month.
In addition, operators take seriously the resurgence of the pandemic in Europe and the impact of health measures, if they were to become widespread in the Old Continent, on the economic recovery. Washington has advised its nationals against travel to Germany and Denmark.
Against this backdrop, the unexpected acceleration of private sector activity in Europe in November was not enough to rekindle market optimism.
On the Paris Bourse, Alstom (+ 2.49%) signed its third consecutive session of increase, the title being generally considered undervalued by some analysts. Airbus gained 1.36% on cheap buybacks after four sessions in the red.
In contrast to the charts, Eurofins lost 4.05% after dropping 1.9% yesterday. The title however shows a jump of more than 50% since the beginning of the year thanks to its exposure to the pandemic. STMicroelectronics and Dassault Systèmes lost 3.96% and 3.76%, penalized by the wind of mistrust blowing over technology linked to the rise in rates.
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