Since the beginning of the year, the CAC 40 index has been in the red, down 1.13%. On the other hand, while the German stock market is up 10%, the Stoxx 50 index of leading European stocks is up more than 7%, the London market is following a similar trend, not to mention American stocks (up more than 15%) if we refer to the S&P 500, which tracks the price movements of 500 American companies.
However, this result must be put into perspective. “Since the lowest point reached at the start of the Covid crisis in March 2020, the SBF 120 index [qui reflète l’évolution de 120 valeurs françaises] rebounded by 95%, the Euro Stoxx 50 by 98% and the German stock market’s DAX index by 103%, which is equivalent”“This is a very important step forward for the Fédéris ISR France fund,” said Pierre Schang, head of the French division of La Financière de l’échiquier, whose Fédéris ISR France fund has achieved one of its biggest increases since the beginning of the year.
How can we explain the decline in French stocks over the past six months? “The specific French political context raises fears, questions and mistrust among international investors”says Stéphane Furet, Deputy Managing Director and Managing Director of Dorval Asset Management, whose Dorval Managers fund has gained 8% since the beginning of the year.
However, these uncertainties do not explain everything. “We can find the same fragmented political context in other countries. Look at what is happening in Germany, where uncertainty is at its peak after the recent regional elections. It is not a Franco-French issue.”Pierre Schang believes.
Sectoral reasons
Much of the French stock market’s slowdown can be explained by sector-specific reasons. “The weight of luxury stocks is very important in the rating, but some stocks have been falling sharply for several months”“This is the case,” says Stéphane Furet, whose Dorval Managers fund’s performance is explained by its absence from this sector. Kering’s shares (Gucci, Yves Saint Laurent) fell by 40% in 2024 and those of LVMH, the world leader in the sector, fell by more than 13% over the same period. Another winning deadlock for the manager: the automotive sector, in which investment is lacking: Stellantis (Peugeot, Chrysler, Fiat, etc.) has seen its share price fall by more than 40% since January.
Can the CAC 40 index make up for the backlog before the end of the year? “We are not immune to technical exhaustion”Judge Patrick Lanciaux, manager of Vega France Opportunities ISR, which is among the best for its performance since the beginning of the year. But “This is, for example, the time to buy cyclical stocks in reversal”believe.
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