The Paris stock market reversed course, falling from +0.6% this morning (around 6,614 points) to -1% (around 6,514), in a market increasingly deserted by investors (E1.1 billion in 6.5 hours) two days before the Christmas truce.
The Euro-Stoox50 (-1%) and DAX (-1.1%) fell more sharply, while Wall Street reopened sharply lower (-1% on the Dow Jones and -1.2% on the S&P500).
Clearly, macroeconomic "good news" is becoming bad news on the US markets: US GDP has been revised upwards by +0.3% to 3.2% annualized in the third quarter of 2022, according to the Commerce Department's third estimate.

This surprise revision marks a more sustained recovery after the 0.6% contraction observed in the second quarter: this is due to higher exports and consumer spending, while activity was held back by a fall in housing investment.

The PCE price index rose by 4.3%, unchanged from the previous estimate. Excluding food and energy prices, it rose by 4.7%, a rate revised upwards by 0.1 percentage points.
US jobless claims rose by just 2,000 in the week to December 12 (to 216,000).
The Labor Department reports that the four-week moving average - considered a better indicator of the underlying trend in the labor market - showed a week-on-week decline of 6,250 to 221,750.

Wall Street may be upset by the rise in oil prices, which slowed somewhat this morning, with Brent crude advancing 0.7% to $83 a barrel, while West Texas Intermediate (WTI) gained 0.8% to $79: this could foreshadow a rise in fuel costs.

Some observers also want to interpret the strength of black gold as a signal of growing optimism about the economy and a return of risk appetite.

Market sentiment now seems more constructive, and the fear of missing out on the upside is currently outweighing fears of continued policy tightening by the major central banks next year.
Note the acceleration in the 2-year yield, which has risen by +5pts to 4.2650% (following the GDP revision), while the 5-, 7- and 10-year yields remain stable at 3.78% and 3.68% respectively.
In Europe, long yields have deteriorated again, with +8pts on our OATs to 2.913% and +7pts on the Bund to 2.372% (same spread on Italian BTPs to 4.490%).

In French company news, Stellantis announced on Thursday that it had completed the acquisition of Hungarian software publisher aiMotive, a deal designed to accelerate its momentum in autonomous driving.

Voltalia announced the start of construction work on a 148-megawatt solar power plant in Bolobedu, South Africa, just two months after signing the CPPA with Richards Bay Minerals (RBM).

Neoen announced that it had signed a Corporate Power Purchase Agreement with TDF, an operator of digital infrastructure and networks in mainland France and the French overseas territories, for 62 MW over a 15-year period.


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