(BFM Bourse) – The Paris stock exchange opened sharply lower on Monday, with Russia’s decision not to restart gas supplies via Nord Stream 1 generating strong risk aversion. Meanwhile, the euro is crumbling.
The Paris Stock Exchange starts the week badly. On Monday, the CAC 40 opened 2.1% lower to 6,039.16 points, erasing much of the gains recorded in Friday’s session.
The wind of panic on all European markets is caused by Gazprom’s announcement on Friday evening that the Nord Stream 1 pipeline would remain closed.
The Russian energy company, which cited an oil spill affecting the operation of a turbine, “did not provide a date for the resumption of flows to Germany, accentuating fears of energy shortages and economic recession in Europe this winter. “sums up John Plassard, director and investment specialist at Mirabaud.
This reason put forward by Gazprom does not convince the German turbine manufacturer Siemens Energy, which believes that such a loss does not in itself constitute a technical reason justifying a business interruption.
Towards restrictions and rationing?
As a result, gas prices are rising again. The October contract on the Dutch TTF thus won 22% at 262 euros per megawatt hour.
“Europe has done an excellent job over the past two months, compared to expectations, in maintaining high levels of gas storage and increasing imports” from countries other than Russia, Deutsche strategists emphasize. “But if Russia no longer supplies gas, it is likely that we will not be able to survive the winter without significant restrictions and rationing,” they add.
European markets will not be able to count on Wall Street for a possible improvement in the trend, the New York Stock Exchange will be closed on Monday due to a public holiday.
The market will also attend the OPEC + meeting during the session, which brings together members of the organization of oil exporting countries and their allies in the early afternoon. In view of the recent collapse in the price of black gold, it is possible that the members of the cartel decide to keep their production quotas, or even to reduce them.
On the currency market, concerns about gas – which also reinforce fears of a recession in Europe – are unscrewing the eurozone currency. The euro lost 0.5% to $ 0.9902, falling below $ 0.99 early in the morning.
Julien Marion – © 2022 BFM Stock Exchange