The Paris stock market was down 1.3% in early afternoon trading, penalized by heavy declines for Société Générale (-8% after profit-taking following results), Safran (-3%) and Teleperformance (-3%).

Red dominated despite the rather accommodative signals sent out the previous day by the Federal Reserve, which could cut rates as early as next month in response to slowing inflation and an easing labor market.

Fed Chairman Jerome Powell indicated that a rate cut in September could be "on the table" if good inflation figures and a moderating labor market were to continue.

For analysts, these comments mean that the US central bank is no longer focusing on its price stability mandate, but is now giving equal weight to the full employment mandate.

"This is a supportive factor for most markets", says Florian Ielpo, Head of Macroeconomic Research at Lombard Odier Investment Managers.

The current belief is that the Fed will cut rates this year, and that this is good news for the economy", he adds.

"Under these conditions, markets may decide to look past the ups and downs of the current earnings season and look to a brighter macro and microeconomic future", concludes the professional.

The day's session is further enlivened by a host of European corporate results, including those from AB InBev, ArcelorMittal, BMW, ING, Daimer Truck, Société Générale and Volkswagen

On the statistics front, the HCOB PMI index for eurozone manufacturing, produced by S&P Global, remained stable at 45.8 in July, continuing to signal a sharp deterioration in the region's manufacturing sector.

In France, unchanged below 50 for the 18th consecutive month, and down from 45.4 in June to 44 in July, the PMI HCOB index for French manufacturing industry highlights a sharp contraction in the sector, the most marked since last January.

The downturn in the index was mainly due to a fall in new orders: manufacturers' overall sales volume posted its biggest drop for six months, with almost a third of respondents reporting weakening demand.

In the United States, weekly jobless claims and ISM manufacturing index figures were published.

The Labor Department reported 249,000 new jobless claims for the week ending July 22, up 14,000 on the previous week.

Non-farm productivity rose at an annualized rate of 2.3% in Q2 2024, according to the Labor Department's first estimate, driven by a 3.3% rise in total output and a 1% increase in hours worked.

With the Fed's support, strategists are beginning to envisage a brighter climate for the stock markets after two difficult months, thanks in particular to the emergence of buoyant technical factors.

Christopher Dembik, Investment Strategy Advisor at Pictet AM, points out that by Friday, 50% of S&P 500 companies will emerge from the 'blackout' period concerning their share buybacks.

The gradual resumption of share buy-backs - which is a groundswell of support for the indices - and the prospect of good results from Nvidia in mid-August could close the summer's bearish parenthesis and allow us to restart on a more solid footing", promises the strategist.

In other French company news, Société Générale reports second-quarter 2024 net income up 23.7% to 1.11 billion euros, giving a return on tangible net assets (ROTE) of 7.4%, and gross operating income (GOI) up 14.5% to 2.11 billion.

Crédit Agricole SA reports underlying net income, group share (RNPG) down 1.5% to 1.82 billion euros for the second quarter of 2024, despite underlying gross operating income up 1% to 3.16 billion.

For the first half of the year, Worldline posted normalized EPS of 0.74 euros and adjusted EBITDA down 0.9% to 514 million euros, on sales of 2.29 billion, with organic growth of 2.1% (including +3.2% in merchant services).

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