CAC40: loses its footing but W-Street holds firm, US rates 4.39

(CercleFinance.com) - Wall Street seems to be wavering after a 5th positive opening: the US indices are down by -0.
1 or -0.2% ('S&P' and Nasdaq) and these gaps are out of all proportion to the -2.4% observed on the Paris Bourse.
The CAC40 is losing ground below 7.350 (support clearly identified on September 6 and October 31) and even lost 100pts more towards 7,245 pts, penalized by the decline in the luxury goods sector with -6.5% for Kering, -4.8% for LVMH and -3.5% for Hermès... sand forgetting -3% for scheider and Legrand.

In Europe, indices held up better in Germany, with the DAX40 down -1.9%, the E-Stoxx50 down -1.6%, while the S&P remained in contact with the 6,000 mark and the Dow Jones (-0.3%) held above the 44,200 mark.

What's more, the 'VIX' is not flinching: at 14.85, its +0.4% 'rise' is downright insignificant... investors remain fully confident in US equities, while they have been ostensibly turning away from Euro-denominated stocks (or those with exposure to the Eurozone) for the past week.

It's hardly surprising that the Old Continent's indices are languishing: not only have they been battered lately by political uncertainty, but also by sluggish growth and disappointing corporate results.

In these conditions, investors should be keen to turn their attention to economic indicators over the coming weeks.
And it's not off to a good start: inflation in the eurozone came in at 2% annualized in October, after +1.7% in September, which seems to make a 50-point drop in December less likely.

The possibility of the ECB stepping up the pace of rate cuts is no longer part of the central scenario, in view of the differences of opinion that currently seem to prevail within the institution.

And on the growth front, in Germany, the ZEW index of investor sentiment is at half-mast, reflecting the impact of the political crisis caused by the break-up of the three-party coalition last week.

On the downside, the inflation rate in Germany - measured as the change in the consumer price index (CPI) compared with the same month a year earlier - has been confirmed by Destatis at 2% for October 2024, compared with 1.6% the previous month.

On the bond front, US 10-year T-Bonds are down +4.2pts at around 4.392%, while German Bunds of the same maturity are up +1.5pts at 2.35%, and our OATs are down +3.5pts at 3.1140%.

Note the continuing surge in the dollar against the euro (-0.5%), which is flirting with 1.0600 (at 1.0602).
The strength of the dollar is causing the ounce of gold to fall back towards $2,600/Oz.

In French company news, Thales Alenia Space, a joint venture between Thales (67%) and Leonardo (33%), reports the successful launch of the Koreasat 6A telecommunications satellite aboard a SpaceX Falcon 9 rocket from Cape Canaveral, Florida.

Getlink announces that LeShuttle carried 147,919 passenger vehicles in October 2024, down 12% on the same month in 2023, which had nevertheless benefited from the impact of the Rugby World Cup.

Copyright (c) 2024 CercleFinance.com. All rights reserved.