(News Bulletin 247) – The Paris index ended sharply lower on Friday, dropping 1.07%. The market reacted to the American employment report which was again below expectations.

The CAC 40 ended a complicated week with a sharp decline. The flagship index of the Paris Stock Exchange ended Friday’s session down 1.07% at 7,352.30 points.

Over the week, the CAC 40 fell by 3.65%, penalized by the market’s renewed concern about the American economy.

Several US statistics had been disappointing, which had made investors nervous before the publication of the US employment report at 2:30 p.m.

Ultimately, job creation in August came in at 142,000 units, compared to 161,000 expected by economists surveyed by the Wall Street Journal. The unemployment rate came in at 4.2%, in line with expectations.

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Not so bad

In summary, Florent Ielpo of Lombard Odier IM believes that this report is “not as bad as expected, but not necessarily good”. He also believes that these data will not necessarily encourage the US Federal Reserve (Fed) to lower its rates by 50 basis points (0.5 percentage points) at its next monetary policy meeting.

“The increase of 142,000 nonfarm payrolls in August was probably enough to tip the Fed in favor of a measured 25 basis point rate cut this month, rather than a more radical measure,” Capital Economics said.

The market hesitated following this publication – the CAC 40 even briefly returned to the green – before falling sharply.

“Action”

Fed Governor Christopher Waller said the current employment data demanded “action,” Bloomberg reported. He also said he was “open” about the size of the rate cut needed.

Next week, investors will be watching the European Central Bank (ECB) meeting. Deutsche Bank expects the European institution to cut rates by 25 basis points.

On the stock market side, Elis fell 15.7% after Reuters reported that the company had approached American Vestis with a view to a potential acquisition. This frightened the market given the size of this target.

Rubis, for its part, dropped 10.85% after publishing results which, according to Oddo BHF, confirm “a lack of momentum (of good dynamics, editor’s note)”.

On other markets, the euro lost 0.2% to $1.1087. Oil was down. The November contract on North Sea Brent lost 1.98% to $71.42 a barrel, while the October contract on WTI listed in New York lost 2% to $67.9 a barrel.