In France, the Cac 40 has just recorded six consecutive weeks of declines, a run not seen since May 2011. This disappointment is emblematic of all countries in this month of October, which has seen a succession of profit warnings. But the scale of the stock market falls is unprecedented. Surprisingly, the companies concerned all posted excellent non-financial performances. A turning point in the development of ESG?
On the Paris stock exchange, French pharmaceutical group Sanofi fell by 18.93%, a loss of €25 billion in one day, after cutting its short-term financial targets as part of its strategic plan. Worldline, the French company specialising in payment systems, saw its share price fall by almost 60% in one day, when CEO Gilles Grapinet announced that sales growth was expected to be between 6 and 7% for the full year 2023, instead of the 8 to 10% expected. Euroapi, the French manufacturer of active pharmaceutical ingredients, lost 59% on 10 October. This led to the resignation of CEO Karl Rotthier. Plastic Omnium fell by just 10% in one session after its profit warning. Alstom lost 40% and Teleperformance 46%.
In Milan, luxury goods group Moncler fell by 6.46%, the worst performer on the Milan index, following the publication of its results. In Frankfurt, Covestro lost 3.41%, weighed down by lower sales volumes.
In London, the British bank Natwest, still at the heart of the affair surrounding the treatment of Europhobic politician Nigel Farage, saw its third-quarter profit quadruple, with provisions for credit defaults down, but analysts were hoping for better and the share plunged by 11.57%.
In Stockholm, the Swedish household appliance group Electrolux (-13.63%), which suffered losses in the third quarter, announced a cost-cutting plan which includes 3,000 job cuts.
On Wall Street, the Nasdaq was buoyed by good results from Amazon, which jumped by 8.2% after tripling its net profit to 9.9 billion dollars in the third quarter, thanks to the performance of its platform and delivery network. This profit, 3 billion dollars ahead of analysts’ forecasts, contrasts with disappointing results for investors in the technology sector, such as those of Alphabet (Google) and Meta (Facebook). Intel (+8.53%) also reassured investors with third-quarter revenues of $14.2 billion, despite the fact that the US chip giant has fallen behind in the race to develop components for artificial intelligence.
One industry is doing well, in all countries: oil & gas. On 27 October, a barrel of Brent crude from the North Sea rose by 0.83% to 88.66 dollars. US WTI gained 0.86% to 83.93 dollars. Oil stocks continue to gain ground. They are not the best-rated ESG stocks.