Sentiment on the CAC40 turns bullish for the first time since 2020

For the first time since 2020, this figure shot upwards, registering a positive burst of interest from CAC40 investors. It happened at the same time as the first round of the French election ballot. 

According to Spectrum Markets, there were 102.8 million securitized derivatives traded in April.

In April, SERIX reached a level not seen since December 2020, reaching 101, with a bullish trend starting in February 2021, when the figure was at its all-time low of 85 (also on a 100 basis).

What is SERIX and why sentiment on the CAC40 is positive

Spectrum Markets has created an ad hoc index to measure the pulse of investors. 

SERIX which stands for Spectrum European Retail Investor Index is, as the acronym itself says, an index that uses trading data taken from the pan-European stock exchange and verifies the sentiment of investors with respect to the market.

The index is calculated by making the proportion between bearish and bullish trades, to obtain a figure on a 100 basis that indicates the strength and direction of sentiment. 

Spectrum Markets (Spectrum MTF Operator GmbH) is headquartered in Frankfurt am Main, Germany. It is a pan-European trading venue for securitized derivatives targeting financial institutions and their investors available in Germany, France, Italy, Spain, Sweden, Norway, the Netherlands, Ireland and Finland. 

The influence of the French presidential election 

Michael Hall, Head of Distribution at Spectrum Markets, put it this way in a statement:

“The presidential elections in France, which many saw as a potential turning point for the entire European Union, naturally attracted a lot of interest from the continent’s retail investors. Especially when the first round of voting led to what seemed like a head-to-head race between the two candidates, Emmanuel Macron and Marine Le Pen, this really caught the attention of investors Long-term retail investor sentiment towards the French CAC 40 stock index, reflected in the chart SERIX, has been improving more or less steadily since February 2021 and the April data suggests that investors are optimistic about the outlook for France with Macron going forward”.

The feeling is that markets feel safe with a Macron reappointment, and that’s what the data has shown from February 2021 to the present. 

Hall continues:

“The presidential elections in France, which many saw as a potential turning point for the entire European Union, naturally attracted a lot of interest from the continent’s retail investors. Especially when the first round of voting led to what it seemed like a neck and neck race between the two candidates, Emmanuel Macron and Marine Le Pen, this really caught the attention of investors.

Over the long term, retail investor sentiment towards the French CAC 40 equity index, reflected in the SERIX chart, has been improving more or less steadily since February 2021 and April data suggests that investors are feeling broadly optimistic about the outlook. for France with Macron in the future”.

In April, 39.5% of trades were conducted outside of standard hours and is the highest monthly figure seen in the past two years.

Derivatives traded were divided as follows: 

• 87.4% on indices; 
• 7.1% on commodities;
• 4.4% on currency pairs;
• 1.1% on equities

With regard to the respective underlying markets traded: S&P 500 (24.3%), DAX 40 (23.4%) and NASDAQ 100 (17.8%).