The star CAC 40 index lost 67.81 points to 7,133.83 points.

The day before, it had rebounded 0.82%.

The Parisian rating started the day with even greater losses, before filling a small part.

“The market problem continues to be the rise in interest rates” on the bond market, describes Valentin Bulle, equity managers at Dôm Finance.

Interest for the French 10-year loan is now 0.37%, while they had fallen back into negative mid-December.

They haven't been this high since the second quarter of 2019.

The 10-year German bund, which is a reference in Europe, is now very close to returning to positive (-0.02%) while the American rate for the same maturity is now at 1.84%.

A rise in bond rates generally penalizes equities because it improves the profitability of bonds, assets considered less risky by investors.

"This is particularly true for all actions that were highly valued, such as luxury in Paris," explains Mr. Bulle.

The three flagship stocks of the CAC 40, LVMH, Hermès and Kering, which have all three done better than the index average since the outbreak of the pandemic, have been in sharp decline since the start of the year.

The rise in rates began with the US Federal Reserve's stated desire to tighten its monetary policy, with an upcoming hike in its own key rates, to combat inflation.

Considered for a time as temporary, the acceleration in the rise in prices lasts longer than expected, and can be further reinforced by the rise in oil prices, which on Tuesday reached their highest level in more than seven years.

What also weigh down the margins of companies as the earnings season begins.

If the results of 2021 will be a success, "the markets are also looking at the prospects", according to Mr. Bulle.

Ubisoft benefits from the breath of Activision-Blizzard

The video game company Ubisoft jumped 11.87% to 50.44 euros after the announcement of the acquisition by Microsoft of the publisher Activision-Blizzard ("Call of Duty", "World of Warcraft", "Candy Crush ") for 68 billion dollars.

Ubisoft had lost almost half of its value in 2021, falling to 40.38 euros in mid-December.

TotalEnergie boosted by oil prices

TotalEnergies finished on the CAC podium, (+1.50% to 50.42 euros) benefiting from the rise in oil prices, as did TechnipFMC (+2.72% to 6.11 euros).

Tech suffers from rising interest rates

Like luxury, technology stocks are more affected by rising bond market rates.

Teleperformance lost 2.74% to 348 euros, STMicroelectronics 2.20% to 42.66 euros, Dassault Systemes 1.55% to 45.36 euros.

Bic tattooed with vegetable ink

The French giant of pens, lighters and disposable razors Bic (+ 2.93% to 50.25 euros) announced on Tuesday the acquisition of the young Canadian shoot Inkbox, specializing in semi-permanent tattoos based on vegetable ink, for a minimum total amount of 57 million euros.

© 2022 AFP

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