The Paris Bourse flies from record to record

The spectacular recovery of the CAC 40 behemoths and the optimism displayed on the occasion of the half-year results push the Paris Stock Exchange to new heights every day. For two and a half weeks, the rise in the Paris index has been almost uninterrupted. The CAC 40 first regained several levels: 6,300, 6,400 and 6,500 points the week of July 20, then 6,600 points on the 28.

The movement accelerated in August. The index tackled its annual records this week. Session after session, he is getting closer to his historic record of September 2000 (6,922 points). After spraying, Monday, the 6,666 points – affected at the close in mid-June – the CAC 40 crossed the threshold of 6,700 points on Tuesday. He finished Thursday’s session at 6,781 points, up 2.55% since the start of the week.

Star index of 2021

For once, the CAC 40 stands out as the star index of 2021. It took longer than major global indices to return to its pre-pandemic level. But this year, it has already gained 22%, clearly ahead of the Euro Stoxx 50 of major European stocks (+ 17%), the London Footsie (+ 10%), the German Dax (+ 15%) or the Italian MIB ( + 15%).

Paris even has the luxury of getting ahead of Wall Street. The S&P 500, Nasdaq and Dow Jones are gaining between 21%, 19% and 18% since the start of the year.

Late resumption

The Parisian market is attractive in several ways. First, the European recovery was late and the Old Continent is not yet running out of steam, unlike China, which is lagging behind. In the United States, fears related to a change in Federal Reserve policy by the end of the year are prompting investors to be cautious. “Everything has been much slower in Europe but it is now that the recovery is accelerating and investors want to take advantage of it”, summarizes Emmanuel Cau, at Barclays.

Another advantage of the Paris Stock Exchange: international investors have long neglected it. It is therefore not “overpriced”. In its August note intended for its customers, the Citi bank ranks France at 4e rank of the most attractive markets.

The markets were also not betting on such a rebound in industrial stocks and banks. However, the latter weigh heavily in the CAC 40. The three best performances of the year are found in sectors which had hitherto been neglected: Saint-Gobain rose by 70%, Société Générale by 59%, ArcelorMittal by 55%.

Rates send a less optimistic signal than the stock markets

Concerns about a slowdown in the recovery and the weakness of the bond supply continue to favor the decline in long rates in Europe and the United States. The French 10-year OAT yield hit a nearly six-month low at -0.177% on Thursday. That of the 10-year German Bund fell below the ECB deposit rate (-0.5%), slipping during the session to -0.524%. The ECB, for whom the rise in inflation is transient, further committed in July to keep rates low for an extended period and to support the euro area economy until inflation subsides. stabilizes durably at 2%.

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