News that the French government increased the retirement age triggered massive protests nationwide. In light of such protests and given the recent banking crisis in the United States that spread to Switzerland, how did the local stock market perform?
The answer is that it performed very well. A resilient stock market puts everything into a positive perspective, as investors believe in a positive outcome in the end.
That is particularly surprising given the fact that the European Central Bank has increased key interest rates by several percentage points already. So what to expect from the CAC 40, France’s main stock market index, moving forward?
CAC 40 on track for a new high
Since late 2020, the French index has been on a bullish movement. It stalled at the end of 2021, when the US dollar began to strengthen, only to find buyers in the 6,000 points area.
After a bullish reversal, the index looks poised to make a new high and climb above 7,500 points. A recent pennant formation confirms the bullish bias, and buyers should keep emerging as long as the price action stays above 6,500 points.
By doing so, the market keeps the higher highs and higher lows series intact, which is a sign of a bullish market in progress.
All in all, European stocks are resilient despite recent negative news (i.e., ECB hiking rates, the war in Ukraine, and fears of a banking crisis). Therefore, the path of least resistance remains the upside.
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