(News Bulletin 247) – This article, with open access, is produced by the stock market analysis and strategy research team at News Bulletin 247. To ensure you don’t miss any opportunities, consult all the analyzes and discover our portfolios by accessing our Privileges area.
The observation is clear: it holds up! It is in these trivial terms that the situation of the Parisian market in the short term can be summed up. Reassured by the coexistence of reassuring macroeconomic figures on both sides of the Atlantic and inflation on the verge of being brought under control, operators continue to believe in an ideal Goldilocks type scenario, that of ” a normalization of inflation without a marked deterioration in the labor market and growth, all accompanied by expectations of monetary easing from the second quarter of 2024″, in the words of Thomas Giudici, head of bond management at Auris Management. In the end on Wednesday, and despite the decline of TotalEnergies (-2.39%), the flagship Parisian index managed to maintain 0.24% at closing at 7,267 points.
And this as we arrive at the statistical high point of the week on the macroeconomic front, with this Thursday the first estimates of consumer prices in November in the Euro Zone and American PCE prices, the Fed’s favorite measure in its appreciation of inflation. Remember that after a very good “Conference Board” of household confidence on Tuesday, American growth, published yesterday, has just emerged slightly above expectations in Q3, at +5.2% in preliminary data, at an annualized rate.
The market is taking as a pretext the statements of the governor of the American Federal Reserve (Fed), Christopher Waller. The latter expressed confidence on Tuesday in the current level of key rates, judging that they should allow the American economy to slow down sufficiently for inflation to return to around 2%. Remember that the Fed will hold its last monetary policy meeting of the year on December 12 and 13 and that its president, Jerome Powell, will speak on Friday.
“But, once is not customary”, notes Alexandre Baradez (IG France), “the markets showed selectivity on the remarks of Christopher Waller. The latter in fact added that the slowdown in the economy (induced by restrictive monetary policy) would have an impact on credit delinquencies and corporate results. Also indicating that these are signs of moderation in demand expected by the Fed.”
On the value side, cyclical stocks are doing well, like the automotive sector such as Stellantis (+5.2%), Forvia (+4%), Michelin (+2.4%). and Renault (+2.3%). Conversely, TotalEnergies fell by 2.4%, penalized by a rating from Jefferies which went from “buy” to “hold” on the stock. The financial intermediary displays its caution on gas prices in Europe as well as on the company’s cash generation.
On the other side of the Atlantic, the main equity indices ended the session at levels very close to equilibrium, with operators clearly expressing their expectation of PCE inflation figures.
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 $1.0970. The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $78.20.
On the agenda this Thursday, preliminary data on consumer prices in the Euro Zone at 11:00 a.m. and PCE (Personal Consumption Index) prices in the United States at 2:30 p.m. Also follow the weekly registrations for unemployment benefits at 2:30 p.m. and the Chicago PMI at 4:00 p.m.
KEY GRAPHIC ELEMENTS
The 7,200 points, unambiguously exceeded on November 17 after pullback, moved to intermediate support, above which the chart situation remains solid. At this stage of the rally nevertheless, of no less than 500 points in a month, a phase of occasional profit-taking, on certain issues, certain sectors, certain styles of values, and for a handful of sessions, is the preferred option. Neutral opinion on the scale of the single session to come.
FORECAST
Considering the key graphical factors that we have identified, our opinion is neutral on the CAC 40 index in the short term.
We will take care to note that a crossing of 7406.00 points would revive the buying tension. While a break of 7200.00 points would restart the selling pressure.
News Bulletin 247 advice
Hourly graph
Daily Data Chart
I have over 8 years of experience working in the news industry. I have worked as a reporter, editor, and now managing editor at 247 News Agency. I am responsible for the day-to-day operations of the news website and overseeing all of the content that is published. I also write a column for the website, covering mostly market news.
