CAC40: luxury goods soar past 7,600 pts

(CercleFinance.com) - The Paris stock market is in the green this morning, gaining 1.
8% to 7,610 pts, benefiting from the surge in the luxury sector with +8.8% for LVMH and Kering and +5.7% for Hermès.

This morning, Richemont's record results, with nine-month sales of 16.2 billion euros, up 3% (+4% at constant exchange rates), revived hopes of a recovery in the luxury sector.

On the statistics front, Germany's inflation rate as measured by the European harmonized retail price index (HICP) was confirmed at 2.8% year-on-year in December, announced Destatis, the Federal Statistics Office, on Thursday.

Investors are now awaiting US retail sales data, due out at 2.30pm, to gauge the state of the economy on the other side of the Atlantic.

The consensus is for a 0.5% month-on-month increase in retail sales in December, which would testify to the strength of consumer demand during the key end-of-year shopping period.

The trend could also be influenced by import price figures, jobless claims and the Philadelphia Fed index, also due in the afternoon.

But the highlight of the day will come at 1:30pm with the publication of the minutes of the December 12 meeting of the European Central Bank (ECB) Governing Council, which resulted in a fourth rate cut in the space of six months.

The institution's president, Christine Lagarde, expressed concern at the downside risks to eurozone growth.

In terms of results, the major US banks will continue to take center stage today, with Bank of America and Morgan Stanley scheduled to report their quarterly results at lunchtime.

Although the latest US inflation figures are reassuring, investors may prefer to remain on the defensive until Donald Trump's inauguration, scheduled for Monday.

At the start of the week, the teams at Cogefi, a Paris-based portfolio management company, warned that "it is likely that the 2025 stock market year will really get underway on January 20".

On the bond front, yields breathed a sigh of relief following the publication of the latest US inflation data, which eased the recent episode of tension.

The yield on 10-year Treasuries fell back heavily towards 4.66%, compared with over 4.80% at the start of the week, a sudden drop that also boosted European markets.

Ten-year German Bund yields are down to 2.55%, while French OAT yields are down to 3.37%, a spread of 82 basis points.

Crude oil prices continue their upward march, with a barrel of US light crude trading just above $80 for the first time since last summer.

This morning, a barrel of Brent crude is down almost 0.9%, at around $81.8.

In French company news, Alstom reports that it has signed a new agreement with Metrolinx for the overhaul and modernization of 181 double-deck suburban train cars for GO Transit, the public transport service in the Greater Golden Horseshoe region of Canada.

TotalEnergies announced that its European refining margin indicator had recovered to $25.9 per tonne in the fourth quarter of 2024, compared with $15.4 in the third quarter, an increase that should be reflected in downstream results and cash flow.

Finally, Stellantis reported on Thursday a 9% drop in vehicle deliveries in Q4 2024, mainly due to North America, where the automotive group is struggling to clear its inventories.


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