CAC40: weekly gain of +0.5%, oil falls back below $73

(CercleFinance.com) - The Paris Bourse regains its bullish momentum with 1 hour to go on this Friday of the "3 Witches", which will conclude a positive October (3rd month in a row) of around +1.
4 to +1.5%, despite rising interest rates and an OAT of over 2.91%.
The CAC40 index rises by 0.4% to 7,615 points after peaking at 7.645: at this stage, the star index is posting a weekly gain of 0.5%, but the CAC can now claim a rise of over 6% since its low point on August 5.

The Euro-Stoxx50 is up over 0.6% at 4.980Pts, in the wake of the Dax40 (+0.4%), which is back on its all-time highs at 19,665Pts.

Wall Street has just reopened mixed, with the S&P500 up 0.2%, but the Dow Jones (at its zenith the previous day) is down 0.4%, and the Nasdaq is up 0.7% at 18.505 (thanks to Netflix's +10%), its best mark since October 15 and July 16.
But these 'tactical' gains ('3 Witches' Day') could prove fragile: 'With the presidential election looming in about two weeks' time, it wouldn't be surprising if investors started to take some profits', says one trader.

With the S&P 500 up 22% year-on-year at this stage, it would be foolish not to," he adds.


The afternoon was punctuated by the announcement of a 0.5% decline in US housing starts in September by the Commerce Department: the score stood at 1,354,000 annualized, following a 7.8% rebound in August (+9.6% initial estimate).

U.S. building permits - which are supposed to foreshadow future housing starts - fell by 2.9% to 1,428,000 last month, while housing completions dropped by 5.7% to 1,680,000 (weather may have disrupted construction in the South).

Following the rise in long-term rates to 4.40%, mortgage applications in the U.S. have fallen by -17% since the beginning of the month, the worst score since April 2020.

Yesterday, the market was not surprised by the ECB's decision to cut rates for the second time in a row, but it did seem to appreciate the institution's more accommodating stance, which points to a fourth rate cut in December.

Given the downside risks to both growth and inflation, the ECB's monetary policy should be eased at an accelerated pace, in order to remove its restrictive character as quickly as possible", insists Bruno Cavalier, economist at Oddo BHF.

Now that the ECB meeting is over, investors will have to start looking for concrete evidence to give them a new direction.
In China, gross domestic product (GDP) growth reached 4.6% year-on-year in the third quarter, according to data released on Friday by the State Bureau of Statistics (BES).

While this performance was slightly better than expected, it points to a slowdown in activity following the 4.7% growth recorded in the second quarter, economists point out.

In the opinion of analysts, the earnings season could be the next catalyst for stock market indices to move higher.
The quarterly accounts of American Express, Procter & Gamble and SLB will be closely scrutinized.

Last night, Netflix (+10% on Friday) did better than expected for the third quarter, both in terms of earnings and new subscriptions.

Prior to this, Wall Street had closed around equilibrium on Thursday evening, held back by the severe tensions observed in the bond compartment.
US T-Bonds '2034' eased -2Pts to 4.075%, the '30 yr' -1.7Pt to 4.377%.
In the Eurozone, our OATs erased -2.3Pts to 2.9080%, Bunds -1.8Pts to 2.186%.
On the energy market, oil prices confirmed their recovery as Israel announced the death of Yahya Sinouar, the leader of Hamas.

Brent ended the week (and the month) close to its lows with -2% at $72.9, while US light crude (WTI) dropped 2.2% below $69 on the NYMEX.
Finally, gold set a new record above $2,710/Oz

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