CAC40: precarious balance, W-Street indecisive, rates tense

(CercleFinance.com) - The Paris Bourse has been hovering tightly around the equilibrium point since the opening, the day after a decline of just over 0.
7% in a generally worrying context.
Buyers had taken the upper hand by mid-morning and succeeded in propelling the CAC40 up to around 7.550... but as the Wall Street reopening approached, heaviness took over again and the CAC40 tried to hold on to 7,530.
US indices or reopened directionless with the S&P500 barely 0.1% down, while the Nasdaq was down -0.2% (towards 18,150).
Nor did the Euro-Stoxx50, stuck at around 4,950, or the DAX40, stalled at 19,100 (despite Bayer's -7% plunge).

While the CAC40 was still trading in the 7,800-point zone just a few days ago, it is now making incursions below 7,500 points, under pressure from three factors", noted Alexandre Baradez, Head of Market Analysis at IG France, on Tuesday.

He pointed to geopolitical stress, with escalating tensions in the Middle East, developments in the political situation and budgetary issues in France, and the postponed expectations of rate cuts in the USA.

'Whether in the USA or Europe, there's probably also a bit of hedging going on ahead of the corporate earnings season, which kicks off in a few days' time. But also a bit of hedging ahead of the US election in a month's time", he added.

While waiting for the real kick-off to the earnings season, which will be given on Friday by JP Morgan Chase, traders should pay close attention this evening to the minutes of last month's Fed monetary policy meeting (FOMC).

There is no debate on the direction of policy (easing), but on the speed of adjustment", said Oddo BHF at the start of the week, estimating that the minutes of the last FOMC "will perhaps shed some light on this point".
The bond markets are taking a break from statistical news, with the day's highlight being the publication of the minutes of the September FOMC meeting at 8pm.
The only 'number' will be the weekly change in US oil inventories (at 4.30pm).

A wait-and-see attitude has prevailed overall since Tuesday evening, ahead of Thursday's US inflation figures.
T-Bonds are down a symbolic +1Pt to 4.0450%, the '2-yr' has the same spread at 3.99%, and the '30-yr' has added 0.5Pt to 4.33%, its worst score since July 31.
The picture is no rosier in Europe, with Bunds at 2.2500% (+0.3Pt only), but our OATs adding +1.5Pt to 3.0320%, and Spanish 'Bonos' taking +1Pt to 3.007%.
The euro loses 0.25% against the dollar to 1.0950, while gold continues to consolidate at $2,615/2,620.

In Paris stock news, Kering announces the appointment of Stefano Cantino as CEO of Gucci, reporting to Francesca Bellettini, the group's deputy CEO in charge of corporate development.

Sanofi reports that new data on its Beyfortus, confirming its real-life efficacy against RSV infections in infants, will be presented at IDWeek 2024, to be held in Los Angeles from October 16 to 19.

Thales announces that its Board of Directors has decided to pay an interim dividend of 0.85 euro per share at the beginning of December, and to cancel 4,268,227 of its own registered shares, representing 2.03% of its share capital.

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