The Paris Bourse is trading around 7615 points this morning (+0.5%), driven by Stellantis (+2.5), STMicro (+2.3%) and Renault and TotalEnergies in ambush (+1.9%).

Buoyed by the Fed's more accommodative approach, the CAC 40 is currently heading for a weekly gain of close to 1%, which promises a fifth consecutive week of gains.

The Fed's more accommodative tone, the most significant event of the week, has reinforced market sentiment for a loosening of monetary policy next year.

The markets thought they were getting all the positive messages they wanted from Chairman Jerome Powell's remarks, namely resilient growth accompanied by inflation now under control.

On this side of the Atlantic, the ECB's speech was admittedly more cautious, but analysts expect the European Central Bank to also start cutting rates in 2024, given the constant downward revision of its growth and inflation forecasts.

On the statistics front, the HCOB flash composite PMI index of overall activity in France fell from 44.6 in November to 43.7 in December, signalling a marked deterioration in business conditions in the French private sector in December.

Representing the sharpest decline in overall activity since November 2020, this trend can be explained by an unfavorable demand environment, reduced customer purchasing power and the general sluggishness of the economy, according to the companies surveyed.
The same trend can be observed in the eurozone, where the HCOB composite PMI flash index for overall activity fell from 47.6 in November to 47 in December, highlighting a decline in activity by private companies in the region for the seventh consecutive month.

Also to be followed this afternoon in the USA, the New York Fed's Empire State index, followed by industrial production.

The post-central bank euphoria continues on the bond market, where the yield on ten-year Treasuries now seems comfortably under the 4% threshold, at 3.91%.

The yield on German Bunds of the same maturity, the real benchmark for debt in the eurozone, is plunging towards 2.1%.

On the currency front, the euro continues to show strength, clinging to the 1.10 threshold, as traders no longer seem so sure that the ECB will beat the Fed to the rate-cutting cycle.

This final session of the week could prove volatile, however, due to the 'four witches' day, which marks the expiry of numerous futures and derivatives contracts.

In French company news, Sanofi announces that the CHMP of the European Medicines Agency has issued a positive opinion for Fexinidazole Winthrop as the first oral treatment for the acute form of sleeping sickness, endemic in East and Southern Africa.
Saint-Gobain announces that it has reached an agreement to acquire a majority stake in IMPTEK Chova del Ecuador, a leading player in the Ecuadorian construction chemicals market providing waterproofing solutions.
TotalEnergies announces the start of construction, in the Northern Cape province of South Africa, of a major hybrid renewable project comprising a 216 MW solar power plant and a 500 MWh battery storage system.

Copyright (c) 2023 CercleFinance.com. All rights reserved.