Investing.com – The CAC 40 falling sharply on Wednesday, posting a decrease of -1.81% at the time of the writing of this article, highlighting the decline of -0.44% recorded yesterday at the closing.
Several factors are weighing on investor sentiment this week, especially with the threat of EU sanctions against Italy for its dérapes budget, which promises a confrontation Italy-EU which should animate the markets if the threats are implemented.
The deputy prime minister Italy Salvini had estimated yesterday that the rules of Europe in terms of the budget are ” old and obsolete “, which confirms that a standoff is in the offing.
The other topic that weighs on the morale of traders in europe this morning is the surprise negative unemployment in Germany, with a number of unemployed further to the highest since 10 years, and with the first increase in the unemployment rate, from 4.9% to 5% for several years.
Finally, the trade war continues to cripple the evolution of actions, with threats of more and more clear of China in regard to a possible restriction of exports of rare earths to the United States, which would clearly be a further escalation of the trade war.
BNP Paribas (PA:BNPP) shows the largest decrease in the CAC 40 today, -8.35%. ArcelorMittal (AS:MT), which announced a reduction of its production in Europe, the fall of his side of nearly 3%. Finally, on the third step of the podium we find Atos (PA:ATOS), to -2.68%.
The increase, only two actions stand out currently : Renault (PA:RENA), which continues to benefit from speculation about a merger with Fiat, with a gain of +0.55%, after +0.84% yesterday and +12% on Monday, and Vivendi (PA:VIV), which is gaining 0.50%.
From a technical point of view, the bear market is confirmed on the index in paris. The fall of the day has led the CAC-40 to break under the previous low for the month of may (5246 points).
The decline in this Wednesday, has also prompted the CAC-40 in the moving average 100 days. At this stage, the next major support is at 5200 points, which is currently the 200-day moving average, before the psychological threshold key 5000 points.
Has the upside, a return above the resistance of 5450 points seems to be needed to alleviate the bearish pressure on the daily chart.