(News Bulletin 247) – The Paris Stock Exchange continues a fourth session of increases, driven by the clear easing in the bond market after the meeting of the American Federal Reserve on Wednesday evening. The CAC 40 closed up 1.85% on Thursday evening, returning to close to 7,100 points.

A wind of optimism has spread to the Paris Stock Exchange, driven by reductions in interest rates on the bond market. The CAC 40 rebounded by 1.85% to close not far from 7,100 points at 7,060.69 points, i.e. at a three-week high.

For now, the Parisian index is having a perfect week, with 4 sessions in the green out of 4. Above all, it has increased by 3.90% since Monday.

Today’s session was focused on central banks, whose investors had the opportunity to dissect monetary policy decisions. The Bank of England kept its rates unchanged this Thursday afternoon, while warning that it was still premature to consider a cut.

A generalized status quo

The American Federal Reserve, for its part, also kept its rates unchanged on Wednesday evening.

Its president, Jerome Powell, acted cautiously during his press conference. “Powell stressed that the Fed is aware of the current risks and uncertainties, and that it will proceed with caution,” notes IG France.

“Powell obviously remained cautious on ‘decline in inflation’ saying that the disinflation process will be bumpy (‘bumpy’) but we sense significantly less anxiety than a few months ago (‘we are making progress’ ). He notably said that the risks on inflation were more balanced. He also appeared much less anxious about wages, specifying that he thought their progression was now consistent with inflation of 2% in the long term. , dissects Bastien Drut from CPR AM.

Of course, Jerome Powell has not ruled out a rate hike in December, but the market seems to judge that the banker’s comments are more in the direction of maintaining rates for the coming months before potential cuts.

Deutsche Bank also notes that if Jerome Powell tried to maintain a speech with a restrictive bias, several small signals show slight, more accommodating inflections on details, such as the labor market.

In any case, the market appreciates this speech which is less restrictive than feared since the yield on the 10-year Treasury bond has collapsed, going from around 4.900% before the Fed meeting to 4.686% this Thursday. Another reason for relief is the long-term financing plan of the US Treasury which will be less important than the market feared and which supports this easing movement on the bond market.

The revenge of massacred values

On the value side, the trend was also good humor, with a jump in cyclical stocks and/or stocks that have recently fallen on the stock market. Orpea rebounded by 13%, Teleperformance gained 5.3%, Worldline 4.7%, Alstom 3.6%…

Real estate companies are also in demand with the easing of bond rates. Unibail-Rodamco-Westfield took the lead in the CAC 40 this Thursday evening (+8.3%), accompanied by Carmila (+7.60%).

Air France-KLM recovered 4.1%, driven by the reassuring message from the American Federal Reserve while Lufthansa (+7.1% in Frankfurt) was also supported by results above expectations in the third quarter.

Atos limited its gains to 0.3% after jumping 18% at the start of the session. Onepoint took 9.9% of the capital, a stake which provokes speculation and which should allow this company to influence Atos’ strategic choices.

In Copenhagen, Novo Nordisk, the largest European capitalization, gained 3% after publishing very sharply increased results in the third quarter. The market reaction remains relatively measured because the company had “pre-announced” its results in mid-October.

On other markets, the euro gained 0.4% against the dollar to 1.0620 dollars. Oil rebounds by 2%. The January contract on North Sea Brent rose 2.1% to $86.38 per barrel while the December contract on WTI listed in New York rose 2% to $82.08 per barrel.