(News Bulletin 247) – The Parisian index ended this Thursday’s session on the rise, driven by the decline in inflation in the euro zone and by a satisfactory PCE index. November marks the second best month of the year for the CAC 40, after January.

The CAC 40 ended a thunderous month of November on a good note this Thursday. The Parisian index rose 0.59% to 7,310.77 points.

Over the entire eleventh month of the year, the big barometer of the Paris Stock Exchange gained 6.17%. The CAC 40 only did better in January (+9.4%) when hopes of reopening the Chinese economy caused significant excitement, particularly in the luxury sector.

A bit like the month of November as a whole, investors appreciated the latest data available on inflation this Thursday. The rise in prices in the euro zone slowed significantly in November, falling to 2.4% year-on-year, its lowest level since July 2021.

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Towards rate cuts

“Inflation in the euro zone fell much more than expected in October, leaving the main rate of the HICP (harmonized consumer price index, Editor’s note) within reach of the Bank’s 2% target European Central Bank (ECB),” says Oanda’s Craig Erlam.

Although ECB members “continued to resist discussions on rate cuts, it will now be impossible to ignore the questions, with markets pricing in one cut in April and at least four in total next year” , he adds.

In the United States, the PCE index, the preferred gauge of the American Federal Reserve (Fed) to measure inflation, increased by 3% year-on-year in November, compared to 3.4% last month. The “core” index, excluding energy and food prices, increased by 3.5%, a figure in line with the consensus of economists surveyed by the Wall Street Journal.

“The drop in the PCE index measuring inflation suggests that speculation on rate cuts (from the American Federal Reserve, Editor’s note) will intensify,” considers Capital Economics.

Orpea collapses

On the value side, STMicroelectronics gained 1%, benefiting from an increase in recommendation from JPMorgan to “overweight”.

But the big hit of the day is signed Eurazeo. The investment company jumped 9.7% after having, during a day dedicated to investors, delivered its financial objectives and indicated that it wanted to generate 4.4 billion euros in excess capital over the period 2024- 2027, of which 2.3 billion will be returned to shareholders via dividends and share buybacks.

Conversely, Orpea collapsed by 91.6%, the market (finally) becoming aware of the mega-dilution that awaits shareholders, while the group completed the first of its three capital increases.

Rémy Cointreau gained 0.64% while the spirits group published results that were down sharply but not necessarily as bad as the market expected.

On other markets, the euro lost 0.6% against the dollar to 1.0909 dollars. After initially rising, oil prices are falling while according to Reuters, OPEC+ member countries have reached a preliminary agreement to make further production cuts. The February North Sea Brent contract lost 2.6% to $80.79 per barrel, while the January contract for New York-listed WTI fell 2.7% to $75.74 per barrel.