CAC 40: PCE prices at statistical high point before Christmas

(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 Parisian market “held” yesterday, at firm levels, close to its zeniths, yielding only 0.16% to 7,571 points, with the constructive support of a downward revision in final GDP data American in the third quarter. The message delivered pleads for a reduction in federal rates, which is naturally what pleased the market, particularly across the Atlantic, and particularly on the most highly valued issues.

This growth has been revised significantly downward to 4.9% at an annualized rate, compared to 5.2% for previous estimates. Enough to fuel the scenario of a more lenient Fed, consistent with the tone adopted by J Powell at the end of the last FOMC of the year.

As a reminder last week, “the Fed made a significant change in communication by indicating that the possibility of rate cuts had been discussed. This appears to be premature given the resilience of growth and an asset market. robust employment and still high inflation”, judge the OSTRUM AM strategists.

It is in this context that operators will learn this Friday of PCE (personal consumption expenditures) prices, the Fed’s preferred measure in its assessment of price dynamics. This is the last big statistical meeting before the big Christmas break. The Parisian market will be closed on Monday the 25th, naturally, but also on the 26th, the day after Christmas, like Anglo-Saxon Boxing Day.

In the meantime, operators have just become aware of the weekly registrations for unemployment benefits, at a level still close to 200,000 new units. Still on the economic activity front, the Philly Fed index, which measures economic activity in the Philadelphia region, fell more than expected, to -10.5 against a consensus of -3 and after -5 .9 in November.

On the value side, Teleperformance recorded the biggest increase in the CAC 40, with an increase of 4%, while Royal Bank of Canada reiterated its advice of “outperformance” on the value. Getlink lost 2.3% at the close, as the Channel Tunnel operator faces an unexpected strike which has led it to suspend its service until further notice and close its terminals in France and the Kingdom. -United. This weighed on his title this Thursday afternoon.

On the other side of the Atlantic, the main equity indices ended Thursday’s session in the green, like the Dow Jones (+0.87% to 37,404 points) and the Nasdaq Composite (+1 .26% at 14,963 points). The S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, gained 1.03% to 4,746 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 $1,1000. The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $74.60.

On the agenda this Friday, PCE prices at 2:30 p.m. and the consumer confidence index (U-Mich, revised data) at 4:00 p.m.

KEY GRAPHIC ELEMENTS

The creation of new zeniths on the CAC, the high point of the autumn rally, will have crowned a remarkable federation movement. The first signs of the need for breathing have nevertheless appeared since Thursday, precisely since these new records were set.

In the immediate future, a healthy wedge consolidation is taking shape.

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 crossing 7585.00 points would revive the buying tension. While a break of 7406.00 points would restart the selling pressure.

Hourly graph

Daily Data Chart