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In the absence of new sharp macroeconomic benchmarks on Monday, the markets were carried away by the hope of a “Goldilocks” scenario, with the CAC 40 managing to grab a few additional points above 7,200 points (+ 0.18% at 7,246 points), well helped by TotalEnergies. which benefited from the rebound in black gold prices before an important meeting of OPEC and its allies on November 26.
“In economics, the “Goldilocks” scenario refers to an optimal situation where growth is modest, but very real, and inflation is moderate,” recalls Christopher Dembik, investment strategy advisor at Pictet AM.
The term is borrowed from a character in a popular tale, Goldilocks and the Three Bears, where a little girl discovers an empty house in the heart of the forest. Attracted by the tempting smell of bowls of hot chocolate (or porridge, depending on the version!), the little girl indulges in tasting the 3 bowls lined up on the table: that of Mama Bear, Papa Bear, and the little one. bear cub. His preference is for the latter, neither too hot nor too cold…
“It is now this scenario that dominates the financial markets after the publication of inflation in the United States,” continues M Dembik. “In terms of monetary policy, this has two consequences: 1) the terminal rate has certainly been reached in the United States; 2) a rate cut may be on the cards. The money market forecasts a first decline in May 2024 compared to June 2024 just a few days ago.”
The markets will be attentive to the minutes of the American Federal Reserve this Tuesday, before taking note of the durable goods orders for October the next day. Note that Wall Street will be closed on Thursday for Thanksgiving celebrations, and stock trading on the New York Stock Exchange will only take place for half a session the next day, Friday November 24.
On the other side of the Atlantic, the main equity indices ended in the green on Monday, like the Dow Jones (+0.58% to 35,151 points) but especially the Nasdaq Composite (+1.13 % at 14,284 points). The S&P500, the reference barometer of risk appetite in the eyes of fund managers, appreciated by 0.74% to 4,547 points.
An update on other risky asset classes: around 8:00 a.m. this morning on the foreign exchange market, the single currency was trading at a level close to $1.0960. The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $77.20.
On the agenda this Tuesday, to primarily follow sales of old homes in the United States at 4:00 p.m. and the Fed Minutes at 8:00 p.m.
KEY GRAPHIC ELEMENTS
The 7,200 points, the technical issue of last week, were exceeded, with the weekly candle closing at its peaks. The flagship Parisian index is now entering a phase of digesting its gains, in the form of a consolidation whose graphic pattern is still being determined.
Considering the key graphical factors that we have mentioned, our opinion is positive on the CAC 40 index in the short term.
This bullish scenario is valid as long as the CAC 40 index is above support at 7000.00 points.
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