The CAC 40 begins to fall below major resistance at 6600 points
The CAC 40 fell sharply on Wednesday after the publication of a 40-year record inflation in the United Kingdom and after disappointing figures from the giant American retailer Target.
UK inflation came in better than expected, up 10.1% year on year, its highest level since 1982 due to higher food prices, prompting faster monetary tightening from the Bank from England.
Later in the day on Wednesday, Target reported net earnings per share half of what was expected due to higher applied markdown rates, raising fears of waning consumer demand.
Market operators took advantage of this disappointing news to secure profits after several sessions of rising stock markets and a return of the CAC 40 below a major resistance zone at around 6600 points.
Although the Parisian index could continue its rebound of the last few weeks in the short term, the outlook remains negative until the economic outlook improves or central banks revise their monetary tightening expectations downwards, which is unlikely without concrete evidence of slowing inflation.
The rebound of the CAC 40 is therefore probably only temporary and could precede a new leg of decline to the lows of the year at around 5800 points.
Daily price chart of the CAC 40 (CFD France 40) – key levels