Stock Exchange: CAC 40 down, what prospects for the end of the year?

The CAC 40 starts the week with withdrawal, in the wake of American markets destabilized by the degradation of the United States note. A temporary drop that does not call into question the bullish prospects for European scholarships according to our analysts.

• 
  

  To safeguard
  

  
  
  

  Saved
  

Bad start of the week for the CAC 40. The Parisian index started the day down on Monday, May 19, yielding 0.74% (at 7,828.48 points) at the opening, to end the day at -0.04% (7,886.69 points). In question: the degradation by the rating agency Moody’s, Friday, May 16, of the sovereign note of the United States, which goes from “AAA” (the highest note) to “AA1”. A decision that also dropped the US scholarship at the opening, the S&P 500 index losing 1.1%, the 0.6%Dow Jones and the NASDAQ 1.5%.

A correlation between the Parisian index and the completely logical American scholarship for Antoine Andreani, research manager at XTB France: “Whether it is a good or bad news, the CAC 40 is always led to the rise or down by the American indices, which act as a virus on it.” It was partly this concordance that allowed the Parisian coast to return to its level before Krach last week, imitating the S&P 500, which had erased the crisis consecutive to the announcements of Donald Trump on customs duties from May 2.

Better macroeconomic prospects for European indices

However, despite the slight dropout of the day, the prospects of European indices, and CAC 40 in particular, remain good in the longer term, according to Alexandre Baradez, responsible for market analysis at IG France: “European equity markets could continue to get out of the game, they have been outperforming American markets by 9% since the start of the year. The numerous drops in the ECB, the lower sovereign rates, the German budgetary bazooka, and the perceived stability of the euro zone compared to the brutal changes in policies (budgetary and commercial) in the United States should maintain the rotation observed in recent months from American assets to European assets. Regarding the CAC 40, the 10,000 -point damage remains “realistic” within one to two years according to the analyst.