CAC40: moves back into green at the end of the session and crosses the 7200 mark

(CercleFinance.com) - At the end of the session, the Paris Bourse was back in the green, gaining 0.
21% to 7,213 points, driven by Schneider Electric (+1.4%) and Airbus (+1.2%), a small feat after a decline of 0.9% this morning to 7,131 pts.

Indeed, indices had fallen this morning after Russia hit the Ukrainian town of Dnipro with an intercontinental ballistic missile.

Against this backdrop, Wall Street was directionless, with the S&P500 gaining +0.3%, the Dow Jones +0.9% and Nasdaq-Composite -0.1%, while Nvidia, which had set a new record at the opening ($152.9 or +3%), fell back (-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 were 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 during the session opening today.

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

Almost 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 indices 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 new US jobless claims (to 213.000) at the end of the week of November 11.

Sales of existing homes in the USA 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 were up 2.9% on the same month last year, the first year-on-year increase in over three years (+1.8% in July 2021).

The median sales price of existing homes rose 4% on October 2023 to $407,200 (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), as announced by the Conference Board on Thursday, which sees in this 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 drop 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 French company news, Bouygues Construction reported that its Americaribe subsidiary had been chosen by US property developer Aimco to build the upscale 34th Street Edgewater waterfront residence in Miami's Edgewater district.

Nexans announced on 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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