The Paris Stock Exchange is expected to open slightly down Monday morning after two weeks of strong growth having brought the CAC 40 above the psychological threshold of 5000 points, which fears that the stock markets have entered a phase of ‘convenience’.
Around 8:15 am, the futures contract on the CAC 40 index – delivery at the end of June – drops 26.5 points to 5168 points, announcing a small consolidation in the first exchanges.
Boosted by the latest announcements from the ECB and by better-than-expected employment figures in the United States, the Paris market was up over 10% last week, which represents its best weekly performance since 2011.
The pan-European Stoxx 600 index has picked up more than 35% of its value since mid-March, making it fear that the index will enter the overbought territory.
“The markets have already ‘priced’ a lot of good news, such as the recovery plans in Europe and the United States, or even the action of central banks,” argues the strategist.
“It remains to be seen whether this trend will continue in contact with the next macroeconomic data and company results for the second quarter,” he warns.
After this spring ‘rally’ – which notably confirmed a return to grace for cyclical stocks most exposed to an economic recovery – investors could wait for new catalysts before resuming purchases.
CAC 40 SHORT (Sell)
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