CAC40: down only marginally after a day of volatility

(CercleFinance.com) - After gaining as much as 0.
4% in the morning, then shedding almost 1% by mid-afternoon, the Paris Bourse ended the session with a limited decline of 0.14% to 7,216 points, penalized in particular by STMicro (-4.2%) and Capgemini (-3.9%).

Across the Atlantic, the Dow Jones advanced by +0.3%, the S&P500 was back in the green (+0.1% for the time being), while the Nasdaq lost less than 0.1%... in other words, the US markets remained indecisive, with a clear bullish bias on the small-cap side, as the Russell-2000 advanced by +0.8%.

At the beginning of the afternoon, investors learned of the eagerly-awaited US consumer price index. Published by the Labor Department, the index rose by 2.6% in October 2024 compared with the same month in 2023, an annual rate in line with expectations and up 0.2 points on September.

Against this backdrop, Wall Street continues to widen its gap with Europe (the E-Stoxx50 falls -0.2% to 4,730 pts), with indexes falling steadily, with gaps of -3 to -3.5% in 48H versus -0.1% for the S&P500 (and +5% in 6 sessions).

On the bond front, 10-year T-Bonds stood at 4.45%, while Bunds of the same maturity fell by +3.3pts to 2.385%.

Investors should now turn their attention to economic indicators to determine whether the current differential between Europe and the United States is justified in practice.

The scenario of a 25 basis point rate cut in December is becoming an assumption that is receiving less than 50% of traders' votes, according to CME's FedWatch tool.

Investors know that a strong economy - accompanied by a resurgence of inflation - would force the Fed to make fewer rate cuts than expected just before the presidential election.

Meanwhile, in the third quarter of 2024, the number of unemployed in France (excluding Mayotte) as defined by the International Labour Office (ILO) rose by 35.000 on the previous quarter, to reach 2.3 million people, according to Insee.

On the FOREX, the Dollar climbed +0.5% against the Euro, which shattered its April 15 low of $1.0625/E and retrograded to 1.0570, its 'lowest' since October 31, 2023.

In the news from French companies, Interparfums expects sales to reach €910 to €930 million and operating margin to exceed 19% again in 2025, a year which 'will also mark the creation of its own brand Solférino'.

On Wednesday, Thales announced the renewal of its maintenance and repair contract with Eastern Airlines Technic (EASTEC), the overhaul subsidiary of Chinese airline China Eastern.

Safran Electrical & Power and Safran Ventilation Systems announced the renewal of their distribution partnership with China Aviation Supplies, an aeronautical parts supplier and MRO service provider.

Finally, Medidata, the life sciences subsidiary of Dassault Systèmes, announced on Tuesday evening that it had sealed a new agreement with Bioforum, a research organization dedicated to clinical trials.

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