The flagship CAC 40 index dropped 30.31 points to 7,222.57 points. The day before, it had lost 0.35%.

"It was a wait-and-see session. If inflation in the United States had been below expectations, we would have gone into the green, in the hope that it would influence the decision of the European Central Bank (ECB) tomorrow," said Philippe Cohen, portfolio manager at Kiplink Finance.

But the consumer price index in the United States rose to 3.7% year-on-year, against 3.2% in July, according to the CPI index released Wednesday by the Department of Labor, a little more than the 3.6% expected by analysts, according to the consensus of Market Watch.

"The acceleration observed is mainly related to the rise in oil prices, which was the biggest contributor to inflation" in August in the United States, comments Philippe Cohen.

"This is an increase that can be described as cyclical," said the analyst, who does not arouse investors' fears before the next meetings of central bankers in Europe on Thursday and in the United States next week.

Thus, "if the renewed rise in energy prices is likely to raise questions and justify a still vigilant stance of the Federal Reserve (Fed), this consumer price report for August should not hinder its apparent desire to pause" in its rate hikes in September, judge Véronique Riches-Flores and Thomas Bauer of RichesFlores Research.

However, on the side of the ECB, "we think that it could raise its rates twice" by the end of the year, says Philippe Cohen.

Bank stocks on the rise

French banks were trending higher on Wednesday. Axa closed up 1.55% to 28.58 euros, Societe Generale gained 0.94% to 26.20 euros and Credit Agricole 0.82% to 11.54 euros. For good reason, "bankers expect a continuation of the rate hike that would allow them to strengthen their margins," comments Philippe Cohen.

The automotive sector supported by the EU against China

Pressed by the France, European Commission President Ursula von der Leyen announced Wednesday the opening of an investigation into Chinese subsidies to electric cars, a move welcomed by EU manufacturers who denounce unfair competition.

Renault topped the CAC 40 and closed up 2.07% to 37.50 euros, Forvia gained 0.60% to 20.23 euros and Plastic Omnium 0.31% to 16.14 euros.

Alstom degraded

Alstom's share price fell 3.89% to 23.22 euros after British bank Barclays lowered the share price target to 16.50 euros for one share, below its current value.

© 2023 AFP