From Paris to New York via Frankfurt, the stock markets partly halted their fall on Wednesday, without however managing to rebound frankly after their tumble at the start of the week linked to the spread of the new coronavirus.
The European stock exchanges temporarily took advantage of the opening in the green of the New York place to recover a little during the session. But the respite was short-lived.
“There is above all a great nervousness and the very brutal developments of the day testify to the difficulties of investors to properly assess the consequences of the epidemic”, estimates with AFP Daniel Larrouturou, an equity manager of Dom Finance. “Investors are sailing by sight based on economic news.”
The CAC 40 and the Dax both experienced an air gap of -2% and -3% respectively during the session, before recovering to finish close to balance.
The New York Stock Exchange ended a few hours later with no clear direction. The Dow Jones fell 0.46% and the S&P 500, which represents the 500 largest companies on Wall Street, by 0.38%. But the Nasdaq, helped by the rise of several technology stocks including the giants Netflix (+ 5.3%), Apple (+ 1.6%) and Microsoft (+ 1.3%), managed to end in the green ( + 0.17%).
Earlier in Asia, the stock markets had again suffered from fears relating to the epidemic, Tokyo falling by 0.79% and Shanghai by 0.83%.
Although the spread of the virus seemed to slow in China, viral pneumonia continued to spread worldwide on Wednesday, with the first case in Latin America, in Brazil.
The new coronavirus has infected more than 81,000 people and left 2,761 dead worldwide, according to the latest official report released Wednesday evening by the World Health Organization (WHO).
“There are always more reasons to worry than to be confident. We do not know what stage of the epidemic we are in and we do not know the extent of the economic damage”, notes Art Hogan, manager of National Holdings’ market strategy.
In this context, investors remain cautious and turned again to safe stocks on Wednesday: a sign of the interest of brokers, the 10-year rate on American debt fell Wednesday to 1.2988%, a level never is seen before. reached before.
– In search of support measures –
For the time being, it is too early to assess the future trade impact of the health crisis and to assess the outlook for the situation. It is this uncertainty, abhorred by the markets, that weighs on equities.
“The markets look gray as they fear contamination from an increasingly large number of countries,” observes an analyst at La Banque Postale Asset Management (LBPAM).
The markets “call for support measures by the public authorities, the central banks in the first place,” writes LBPAM in a note.
However, many market players are questioning the effectiveness of a key rate cut to respond to a half-mast supply.
“Many companies, including Apple, Pernod Ricard, and the luxury sector have already warned that disruptions in the supply chain would impact their first-quarter performance,” said Franklin Pichard of Kiplink Finance.
To restart the machine, China has announced a vast plan to support small and medium-sized businesses asphyxiated by the epidemic, encouraging banks to grant them preferential loans.