The Paris Bourse is going nowhere (CAC40 unchanged at 7,210) and, above all, volumes continue to plummet, with less than E750 million traded in 6 hours (the day after a session in which the E1.5 bn mark in actual trading was barely crossed at 5:30 p.m., the final score after arbitrages being E2.5 bn).
Admittedly, the market lacks a catalyst and there are no news items to drive the equity markets forward, but we are living through a period that has no equivalent in 30 years.
Another striking fact is that the VIX associated with the S&P500 has contracted to 14, a level that reflects not only complacency but also the ideal macro conditions anticipated: a radiant present and future.

Since the start of the year, the CAC 40 is still up by over 11%, but has fallen by almost 5% since its all-time high of 7,577 points on April 21.
Analysts warn that, while the index has so far managed to defend the symbolic 7,200-point threshold, it will be difficult for it to rise again in the absence of new catalysts.
We might have thought that salvation would come from Asia this morning, but Tokyo completely reversed (-1.8%) after setting a new 30-year record at 33,618Pts: consumer spending fell by -4.4% in May (over 12 months).
In Hong Kong, the Hang Seng index ended up 1.7%, with investors betting on further stimulus measures in China to bolster the fragile post-Covid economic recovery.

"Over the next few weeks, the market is likely to remain volatile as it awaits clearer indications of upcoming developments", predicts Gilles Guibout, Head of European Equities at AXA IM.

Economic, first of all, to understand what impact the current slowdown could have on corporate earnings", stresses the strategist.

"Financial, secondly, to see what the central banks' next decisions on monetary policy will be, in order to determine what the appropriate valuation multiple should be", he adds.

With stock markets beginning to show signs of fatigue, particularly in the US where the Nasdaq's recent rally is running out of steam, it seems hard to predict where the next growth factor will come from.

Markets failed to react to the release of the US trade balance: the deficit widened by +23% in April, reaching $74.6 billion, compared with $60.6 billion in March (revised from the $64.2 billion announced last month), according to the Commerce Department.

This increase in the deficit resulted from a 3.6% drop in exports of goods and services, to $249 billion, and a symmetrical 1.5% rise in imports of goods and services, to $323.6 billion.

In France, the trade balance held steady at -9.2 BnE in April 2023, as a three-month moving average according to the French Customs Department. Imports and exports both fell by E0.2 bn to E59.3 bn and E50.1 bn respectively.

On the bond front, yields deteriorated slightly: +1Pt on OATs to 2.933%, Bunds posted the same spread at 2.38%, while Italian BTPs remained stable at 4.17%.
In New York, T-Bonds also gained +1Pt to 3.72%, and across the Channel, another bad session with Gilts up +3.5Pts to 4.243%, despite the dollar's -0.25% decline to 1.0720/E.

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