CAC40: resists towards 7500, Wall Street widens its losses

(CercleFinance.com) - The CAC40 (-0.
5%) seems to be repeating yesterday's scenario, with an initial downturn followed by a near-equilibrium return: what resilience from the Paris Bourse and the euro-Stoxx50 (-0.3%) despite persistent interest rate tension (OAT at 3.055% and Bund at 2.323%) and the heaviness of US indices.

Wall Street reopened in retreat, then rapidly widened its losses: the Dow Jones and Nasdaq dropped -0.8%, the Nasdaq -1% as the quarterly publication season intensified.

But above all, T-Bond yields tightened by +3.8pts to 4.251% on the '10-yr' and to 4.528% on the '30-yr' (3pts).

Euro-denominated sovereign debt is faring a little better, but the Bund is up +0.5Pts at 2.322%, while the OAT is stabilizing at 3.05%.

Some experts believe that a return to power by Trump would be inflationary: "The stock market is starting to get into the American spirit, and is betting that Trump has a strong chance of winning the November 5 election", says Christopher Dembik of Pictet Asset Management.

He points out that 'the negative correlation between the bond market and equities is not systematic'.

'The US market is also more resilient than the European market, due to positive results overall. In Europe, we have had confirmation that economic momentum is slowing down, which is weighing on results", he continues.

On the figures front, resales of existing homes in the US are slowing down (-1% over 1 month, the worst score since the end of 2010), reflecting the rise in interest rates at the end of September: cash purchases account for 38% of transactions, while first-time buyers account for just 26%. The average time-to-market (time-to-sale) has risen to 28 weeks from 21 a year ago, with the average property price at $404,500 (+3% annualized).

On the FOREX, the Euro continues to decline: -0.2% against the Dollar to 1.0775, signalling the imminent break of the major support at 1.0790/$ of last August 1.

Corporate news continues to punctuate the week in Paris, with numerous publications this morning such as those of Air Liquide, which reported quarterly sales up 3.3% on a like-for-like basis (down 0.7% on a reported basis). The Group posted sales of 6.76 billion euros for the third quarter of 2024.

On Wednesday, the ounce of gold set a new all-time record at 2,755 and the ounce of silver attempted to break through the resistance of the $35 mark set in October 2012.

The morning also saw, for example, sales figures from pharmaceutical company Ipsen, accompanied by an increase in its annual targets, and from Thales, marked by a sharp rise in orders.

Thales reported sales of €14.07 billion for the first nine months of 2024, up 9.4% overall and 6.2% on a like-for-like basis, with organic growth driven in particular by the defense and security sector (+8.5%).

Among the other heavyweights on the Paris stock exchange, operators also reacted to the end-of-September sales figures for cosmetics giant L'Oréal and communications group Vivendi, unveiled on Tuesday evening.

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