CAC40: up 0.2%, despite contrasting W-Street and interest rates

(CercleFinance.com) - The Paris stock market is back in the green (+0.
2%), thus "rescuing" the 7,200... a small feat after a 0.9% decline this morning, to around 7,131.
Indeed, the indices had fallen this morning as Russia struck the Ukrainian town of Dnipro with hypersonic missiles, not equipped with military or nuclear warheads - a sort of "dry run" test - which demonstrated the impossibility of intercepting these "munitions".

But since each protagonist in the Russian-Ukrainian war seems intent on remaining at the intimidation stage, the markets seem reassured.

Wall Street remains seemingly directionless, but the S&P500 grabs +0.2%, the Dow Jones +0.8% and the Nasdaq-100 -0.8%, while Nvidia, which set a new record at the opening ($152.9 or +3%), turns downwards (-2% to -2.5% after Wednesday's results).

The American AI chip giant's quarterly results exceeded expectations, driven by strong demand for its 'Hopper' architecture, soon to be succeeded by the new 'Blackwell' platform.

Jensen Huang, founder and CEO of the Californian group, was quoted in the processor manufacturer's press release as saying: "The AI era is moving full steam ahead".

Sales for the three months to the end of October jumped 94% year-on-year to $35.1 billion, with earnings per share (EPS) up 103% to $0.81. This compares with analysts' forecasts for the first half of 2009.
By way of comparison, analysts were expecting average EPS of $0.70.
The stock has gained almost 196.5% this year, with a market capitalization of $3,600 billion.

In a note released earlier this week, Goldman Sachs strategists warned that valuations for the 'Magnificent Seven' were beginning to approach fair value, leading the investment bank to anticipate an attenuation of their outperformance relative to the rest of the market.

What's more, fourth-quarter sales are forecast at $37.5 billion, 'just' above the consensus figure of $37.1 billion", adds Jim Reid, market analyst at Deutsche Bank.

In addition to Nvidia's results, investors will have to digest a whole series of economic indicators in the session opening today.

Manufacturing activity in the Philadelphia region contracted in November, according to the local Fed survey, with the Philly Fed diffusion index of general current activity falling from +10.3 in October to -5.5 for the current month.

Nearly 18% of companies reported an increase in general activity this month (versus 24% last month), while 23% reported a decrease (versus 14%) and 58% reported no change.

The new orders and shipments indexes also fell, but remained positive, losing five points to +8.9 and three points to +4.5 respectively, while the employment index returned to positive territory, at +8.6.

The Labor Department announced a drop of -6.000 fewer new US jobless claims (to 213,000) at the end of the week to November 11.
The four-week moving average - more representative of the underlying trend - came in at 217,750, down 3,750 on the previous week. and the Conference Board's leading indicators.
Sales of existing homes in the United States rose by 3.4% in October 2024 compared with the previous month, to a seasonally adjusted annual rate of 3.96 million, according to the National Association of Realtors (NAR).
The latter also points out that sales rose by 2.9% compared to the same month last year, the first year-on-year increase in more than three years (+1.8% in July 2021).
The median sales price of existing homes rose by 4% compared to October 2023 to reach $407.200 (a record!), and the inventory of unsold existing homes stood at 1.37 million, representing 4.2 months' worth of inventory at the current rate.

Finally, the index of leading indicators, which is supposed to foreshadow the evolution of economic activity in the United States, fell slightly more than expected in October (-0.4% to 99.5), announced the Conference Board on Thursday, which sees this as the effect of the recent hurricanes.

The sluggishness of industrial orders was the main contributor to the indicator's decline, says the ConfBoard, although the fall in the number of hours worked in the manufacturing sector, the rise in unemployment registrations and the decline in building permits also weighed.

Over and above the temporary impact of the recent hurricanes, the trade body believes that the indicator still points to 'difficulties ahead for economic activity'.

US T-Bonds are reversing the trend and are down slightly (+1Pt to 4.150%), while in Europe, our OATs are stagnating at 3.095%, in contrast to the upturn in Bunds (-3Pts) to 2.313%.

In Europe, the business climate in France darkened again in November, according to Insee, whose synthetic indicator, calculated from business leaders' responses, dropped one point to 96.

In other French company news, Bouygues Construction reports that its Americaribe subsidiary has been chosen by US real estate developer Aimco to build the 34th Street Edgewater upscale waterfront residence in Miami's Edgewater district.

Nexans announced Thursday that it would become the first cable manufacturer to integrate its products within building information modeling (BIM) technology through a partnership with the global BIMobject platform.






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