CAC 40: limited trading without Wall Street

(CercleFinance.com) - The Paris Bourse is set to attempt a slight rebound in early trading on Thursday, in what promises to be a quiet session due to the closure of Wall Street for Thanksgiving.


At around 8:15 a.m., the future contract on the CAC 40 index - December delivery - was up 18.5 points at 7172 points, suggesting a slight recovery after three straight sessions in the red.

Yesterday, the Paris market ended the session down 0.7% at 7143 points, in a climate of political uncertainty which continues to constitute a predominant risk from the investor's point of view.

The Barnier government's budget has still not been ratified by the National Assembly and has been sent back to the Senate, where it is expected to be amended, but with no guarantee that its final version can be validated by both Houses.

Beyond the political question, the economic, fiscal and geopolitical worries affecting Europe are still prompting investors to be cautious, and seem to be preventing any immediate stock market recovery.

Since its all-time high in May, the CAC 40 index has fallen by 13.5%, while the Euro STOXX 50 has posted a limited gain of 4.7% at this stage of the year, a far cry from the surge of more than 25% posted by the S&P 500 since the start of the year.

While the volume of activity is likely to be limited today due to the closure of the US financial markets for Thanksgiving, the session in Europe will be enlivened by the latest inflation figures in Germany.

Due to a pronounced base effect in energy costs, inflation had risen from 1.8% in September to 2.4% in October.

Given that prices had fallen sharply (-0.7% in monthly terms) in November 2023, the basis of comparison is likely to be unfavorable again this month.

On Wall Street, U.S. equity markets allowed themselves a session of marginal consolidation yesterday, following another flurry of all-time highs, despite a strong easing in interest rates.

At the final bell, the Dow Jones dropped 0.3% and the Nasdaq lost 0.6%.

On the US bond market, which will be closed this Thursday, the yield on 10-year Treasuries eased to 4.24% last night after the publication of an inflation indicator perfectly in line with expectations.

The New York Stock Exchange will reopen tomorrow, but only for half a day ('Black Friday').

Also on the bond front, the yield on French 10-year debt returned yesterday, at 3.02%, to the same level as its Greek equivalent.

While the German Bund eased to 2.16%, the financing differential ('spread') between France and Germany now stands at 86 basis points, compared with 45 points before the June 9 dissolution.

Oil prices are little changed, as investors wait to see how OPEC+, which meets next week, will react to ongoing geopolitical tensions and current economic uncertainties.

Brent crude is stable at $72.8 a barrel, while West Texas Intermediate (WTI) is down 0.1% at just under $68.7.

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