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The control room of Euronext, the company that manages the Paris Stock Exchange, in La Défense (AFP/ERIC PIERMONT)
The Paris Stock Exchange signed its fourth consecutive session of decline (-2.75%) on Monday, weighed down by threats to the global economy, including confinements in China, the war in Ukraine and inflation.
The CAC 40 star index fell 172.34 points to 6,086.02 points. On Friday it had ended with a fall of 1.73%, concluding a third consecutive week in the red (-4.22%).
Compared to its peak in early January, the Parisian rating has even lost 17.5% of its value.
Markets are suffering from a global “negative backdrop”, stresses Mikaël Jacoby, head of continental Europe brokerage at Oddo Securities, explaining that “stagflation”, a situation of stagnant economic growth and high inflation, risks being part of the backdrop. of the next few months.
“There is nothing new today but we are in an environment of concerns, which for a week have prevailed over the indices”, comments Mikaël Jacoby.
In fact, investors are facing a mix of headwinds for global growth: high and persistent inflation, the Russo-Ukrainian conflict that is weighing down the European economy, health measures in China that are disrupting supply chains, and monetary tightening in central banks.
In China, millions of Pekingese work from home on Monday after a new tightening of anti-Covid measures. The economic effects of the Covid-0 policy are already being felt: in two years, China’s exports have never grown so weakly (+3.9% in April).
In addition, the geopolitical situation in Ukraine is stagnant. Russian President Vladimir Putin stood by his position on Monday and reaffirmed that his army was fighting in Ukraine to defend “the homeland” against an “unacceptable threat.”
Western countries continue to harden their stance: the G7 countries, which on Sunday accused Vladimir Putin of whitewashing Russia “with shame” with his actions in Ukraine, have pledged to divest from Russian oil but without giving a precise timetable.
Discussions continue, in particular, within the member states of the European Union: the president of the European Commission will also travel to Hungary on Monday, where President Viktor Orban will block the proposed embargo on Russian oil.
In an attempt to curb inflation that is reaching record levels, central banks are raising their reference rates and reducing their purchases of assets in the markets, measures that risk weakening global growth if not properly dosed.
First consequence, bond rates have reached levels not seen for years.