CAC40: returns to 7,500, rates ease 4pts

(CercleFinance.com) - The Paris Bourse is pulling back, but in a very "controlled" fashion, as the CAC40 swung 10pts either side of a 7,480pt pivot between 9:35 and 15:35: a veritable algorithmic straitjacket.


With a less negative opening than expected from Wall Street, the CAC40 has just returned to the 7,500 mark, cutting its losses from -0.2% to -0.3% instead of -0.5% on average for nearly 6 hours.
Investors are reluctant to lighten their positions on the eve of the European Central Bank's eagerly-awaited comments on its decision to reduce the cost of money (Germany's difficulties threaten growth throughout the eurozone), not forgetting the '3 Witches' on Friday, which will round off an upbeat October, as in the previous 2 months.

Wall Street stumbled a little on Tuesday following the -5% fall in the semiconductor sector (risk of embargo of premium chips to Asia announced by the Biden administration)... but things are already looking up with +0.5% on the Dow Jones, +0.2% on the S&P500 and the Nasdaq reducing its decline to less than 0.2%.

The Euro STOXX 50, which tumbled 1.8% on Tuesday in the wake of the warning issued by ASML, the Dutch manufacturer of equipment for the semiconductor industry, is down a further 0.6%, while Amsterdam is down -0.7% (ASML has lost 20% in 24 hours, representing a capitalization of E50 billion).

It has to be said that the company's performance is frankly poor, with order intake for the third quarter only reaching 2.6 billion euros, half of what the consensus was expecting", comments a London-based trader.

The publication last night of the 3rd quarter results of French luxury giant LVMH (-4.5%) added to this gloomy climate, with sales below market forecasts.

The good surprise of the day was the continued easing of rates in the EU and on US T-Bonds (-4Pts on average): in September, US import prices recorded their sharpest fall since December 2023, under pressure from oil and food prices, confirming the recent trend of slowing inflation.

Import prices fell by 0.4% last month, following a 0.2% drop in August, according to statistics published Wednesday by the Labor Department.

Over the 12 months to the end of September, they were down by 0.1%, following increases of 0.8% in August and 1.6% in July.

In September, imported oil prices dropped by 7.1%, while food prices fell by 1.5%.

Export prices fell by 0.7% last month, following a 0.9% drop in August.

US retail sales and business inventories figures are also on the menu for October 16.

In the UK, the consumer price index rose by 1.7% over the 12 months to September 2024, an annual rate down 0.5 points on the previous month, according to the Office for National Statistics.

On the bond market, the yield on the ten-year German Bund eased by 4.5 basis points to 2.1800% and that on French OATs by -4.7Pts to 2.916%, while T-Bonds of the same maturity erased 3 basis points below 4.0050%, with the '2-year' coming in at 3.936% (-2Pts).

On the oil market, Brent crude continued its slide, down 1% to $73.9
in London, due to the downward revision of OPEC demand forecasts and Israel's promise to strike only Iranian military positions.

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