CAC40: -0.8%, mysterious air pocket, quickly filled at W-Street

(CercleFinance.com) - The Paris Bourse cut its losses to -0.
8%, after losing -1.3% to 8,065, in the wake of Wall Street's mysterious pre-opening stall from 10 a.m. French time.
The CAC40 was weighed down by Stellantis (-3.3%), ST-Micro and Arcelor (-3%), as well as BNP-Paribas and Thalès (-2.3%).
US indices, which were losing more than 1% on average around 1 p.m., limited the damage with -0.7% at the opening, then posted -0.10% after 1/2 hour's trading, then +0.2% after 40 minutes: the pre-opening "air pocket" has thus been filled (but what happened?).).

Difficult to explain this rebound: to remain rational (after an initial fall which was not), 2 figures were published in the US at 1:30 p.m... and they only added to investors' perplexity.

Manufacturing activity in the Philadelphia region declined, according to the local Fed's index, which fell from 18.1 in February to 12.5 in March, its second consecutive drop.

Survey indicators for general current activity, new orders and shipments fell, while in a completely paradoxical move, the employment index hit a multi-year high.
The Philly Fed adds that both price indices remain elevated, and that future survey indicators suggest growth expectations are narrowing over the next six months.

The Labor Department reports a marginal increase of +2,000 in new US jobless claims last week, to 223,000.
The four-week moving average - more representative of the underlying trend - came in at 227,000, a marginal increase of 750 on the previous week.

Finally, the number of people receiving regular benefits rose by 33,000 to 1,892,000 in the week to March 8, the most recent period available for this statistic.

Last night, the US central bank kept its key rates unchanged at 4.25%/4.50% for the second time in a row, as expected, but made comments and projections interpreted as more "accommodative" than expected.

According to Chairman Jerome Powell, the latest economic data suggest that the US economy is weakening somewhat, but that neither recession nor inflationary overheating is on the horizon, so there is no need to change course.

Although its updated projections still point to two rate cuts over the course of the year, more policymakers than before are considering not cutting rates at all, or only once," Commerzbank points out.

After the Fed on Wednesday evening, the Bank of England announced that it would keep its key rate unchanged at 4.50% (a vote of seven to two was anticipated by Bank of America).

On the bond front, US 10-year T-Bonds eased -5.3pts to 4.202%, Bunds -3.3pts to 2.7636% and our OATs -2.1% to 3.452%.
Brent crude oil (+0.3%) traded at $71 and the euro suddenly dropped -0.7% against the greenback, to $1.0835.

In Paris, Sodexo (-18% to 59E) lowered its outlook for fiscal 2025, mainly due to weaker-than-expected organic growth in North America, on the occasion of an estimate of its first-half results.

Sanofi reports that it has reached an agreement with Dren Bio to acquire DR-0201, a bispecific antibody targeting myeloid cells for robust B-cell depletion, 'an additional asset to consolidate its leadership in the immunology sphere'.

Also in the news, Eurofins Scientific announces its intention to launch a fifth share buyback program, and Esso reports a fall in profits in 2024, while Valneva claims an improvement in its results.

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