2023-10-03 17:18:41
A critical level. The flagship index of the Paris Stock Exchange fell below 7,000 points on Tuesday for the first time since last March at the time of the banking crisis. The CAC 40 fell to 6,993.50 points around 3:00 p.m. (1:00 p.m. GMT), down 1.06% compared to the previous day’s close.
The market has been weighed down for around ten days by the rise in interest rates on the bond market, which have reached their highest levels in several years. At its last meeting in September, the American Federal Reserve (Fed) was firmer than investors anticipated. It predicted that its key rates would remain at high levels in 2024, while the markets saw them falling again in the near future.
Generalized trend
Since September 20, the CAC 40 has lost more than 4.5%, while at the same time the interest rate on ten-year French government debt has increased from 3.23% to 3.48 % and reached a new high since November 2011. The yield on ten-year US government bonds also continues to rise and is at its highest level in almost 16 years, at 4.74%.
The same downward trend is observed on other stock exchanges. The Frankfurt Dax index is, like the CAC 40, at its lowest since March 2023. In the spring, a feeling of panic contaminated the banking sector after the bankruptcy of two American regional banks. The shares of European groups had recorded sharp declines and, faced with fears of systemic consequences, Credit Suisse was urgently bought by its compatriot UBS, under pressure from the Swiss authorities.
Since the start of the year, the Paris stock market has nevertheless posted an increase of more than 8%, the result of the good performance of European economies.
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