The Paris Stock Exchange ended in the red, weighed down by disappointing company results due to a drop in Chinese consumption linked to the country’s economic situation.
The CAC 40 fell 0.50%, losing 37.62 points, to settle at 7,497.48 points. On Tuesday, the flagship index finished stable, dropping some 0.01%.
Highlight of the session, “company results confirm that demand from China is weak”estimates Charlotte de Montpellier, economist at ING interviewed by AFP.
Sales of French cosmetics giant L’Oréal only increased slightly in the third quarter to 10.28 billion euros, the group says it is facing a Chinese market “more difficult” than expected.
“What was less expected (…) was the situation in the Chinese market, which not only did not improve during the summer but rather tended to be even more difficult”explained to AFP the general director of L’Oréal, Nicolas Hieronimus.
The group’s stock lost 2.49% to 358.10 euros.
The Parisian market, and especially its flagship CAC 40 index, is particularly exposed to Chinese consumption.
Of “many French companies are positioned in the luxury sector. In recent years, a large part of the sector’s growth is linked to the Chinese consumer who adores French luxury.specifies Ms. de Montpellier.
French companies “pay” now this exhibition. For the economist, it is also the “confirmation that the weakness of the Chinese economy will continue to rule the markets”.
The slowdown in Chinese growth had already revived concerns in the second quarter about a post-Covid-19 recovery that was much more sluggish than expected.
Fears confirmed by the growth figure for the third quarter at 4.6%, the weakest in a year and a half when the country was barely emerging from its health policy “zero Covid” which had paralyzed economic activity.
In recent weeks, the Chinese authorities have multiplied announcements and measures for an economic recovery of the country, but nothing enough « concrete » or ” sufficient “ from a market point of view “to completely change the situation”specifies Ms. de Montpellier.
Air Liquide in the red
Air Liquide confirmed its 2024 objectives on Wednesday, despite a 0.7% decline in turnover in the third quarter, linked to “a negative exchange rate effect and a fall in energy prices” dont “variations are passed on to customers” and does not affect the result.
The stock lost 0.95% to 169.30 euros on Wednesday on the Paris Stock Exchange.
