The Paris Bourse set a new annual record at 7,030 (+0.8%), before retreating slightly to 7,020Pts (+0.65%): the weekly result is positive by more than +2%, and the gain has reached +8% since January 1st, the best 1st fortnight on the stock market in 44 years.
The Euro-Stoxx50 grabs +0.3%, while Frankfurt remains close to equilibrium.
Wall Street has just reopened down from -0.3% (Dow Jones) to -0.6% (S&P500), but operators seem to be anticipating a recovery in US indices.

The CAC40 saw its advance slowed by the sharp decline in the automotive sector, with -4% for Stellantis, -2.5% for Renault, and -0.8% for Michelin.

The chapter on US inflation closed with US import prices: they rose by 0.4% last month, following a 0.7% drop in November 2022, while export prices fell by 2.6% in December, after a 0.4% decline the previous month.

According to the Labor Department, over the last 12 months, US import prices rose by 3.5% (+1.9% excluding petroleum products), while export prices rose by 5% (+4.4% excluding agricultural products) in December 2022.

In Germany, according to initial Destatis calculations, price-adjusted German GDP for 2022 rose by 1.9% compared with 2021.
After adjusting for calendar effects, economic growth stood at 2%.

'In 2022, Germany's general economic situation was affected by the consequences of the war in Ukraine and extremely high energy price rises', explains Ruth Brand, President of the Federal Statistical Office.

There were also severe material shortages and delivery bottlenecks, a massive rise in prices, e.g. for food, skilled labor shortages and the continuing but waning Covid-19 pandemic', she continues.

The stagnation of German GDP in the fourth quarter shows that high inflation has not spared the German economy', reacts Commerzbank, for whom 'a mild recession with a 0.5% drop in real GDP remains likely' in 2023.

In Europe, industrial production rebounded by 1% in the eurozone in November, a much stronger rise than expected, show figures published Friday by Eurostat.

By way of comparison, economists on average were forecasting a limited rise of 0.5%, following a 1.9% decline in October.

In detail, production of capital goods rose by 1%, intermediate goods by 0.8% and consumer durables by 0.4%, while energy production fell by 0.9%.

At state level, the biggest monthly rises were recorded in Ireland (+6.4%), Luxembourg (+5%) and Malta (+4.6%), and the biggest falls in Estonia (-3.7%) and Croatia (-1.9%).
Compared with November 2021, industrial activity in the region rose by 2%.

Starting this Friday, investor interest will now turn to the corporate earnings season, which kicks off today with US banking groups.

Financial services giants Bank of America, Citi, JPMorgan Chase and Wells Fargo are all scheduled to unveil their fourth-quarter accounts at midday.
Citigroup reported a -21% decline in fourth-quarter earnings, to $2.51 billion, due to higher provisions for bad debts.

After the reassuring economic indicators published in recent weeks, markets are now waiting for corporate results to confirm the resilience of economic activity.

Investors are not ready to hear any negative rhetoric, as few warnings have been announced by companies to signal a trend reversal", emphasize Kiplink's analysts.

According to FactSet data, the earnings of the companies making up the S&P 500 are set to decline by just over 4% over the last three months of 2022.

Forecasts were more optimistic last September, with expected growth of 3.5%.

The next few sessions are likely to prove volatile, as it is not unusual for markets to hesitate until they can make up their minds not only on the quality of earnings, but also on the quality of their outlook.

In company news, OVHcloud reports a very good start to the year, with sales of 216 million euros for the first quarter of its 2023 financial year, up 15.4% on the same period last year.

TotalEnergies announces the start-up of the Deutsche Ostsee LNG import terminal in Lubmin on Germany's Baltic Sea coast, enabling the French company to become one of Germany's leading LNG suppliers.

Air France-KLM jumps nearly 7% to top the SBF120 index, buoyed by a recommendation upgrade from 'neutral' to 'buy' by UBS, with a price target raised from 1.75 to two euros for the Franco-Dutch airline.


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