(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.
Volatility has remained intense since the start of the week, in the wake of the inextricable political situation in France. The market, however, recovered a few points on Wednesday, with this perspective in mind: better a 2026 budget, even truncated by numerous savings proposed by François Bayrou, than no budget at all. And the final negotiations led by the resigning Prime Minister Sébastien Lecornu do not exclude this hypothesis.
After receiving training from the right and the center on Tuesday, he spoke with the left-wing parties this Wednesday. A little earlier in the day, the political leader assured that he saw a “convergence” to reach a budget before December 31, which removes “the prospects of a dissolution”. He also assured that his interlocutors agreed on the fact that the public deficit should not exceed 5% of GDP in 2026.
However, the declarations of the different political parties do not really invite optimism. An emblematic figure of the National Rally, Marine Le Pen declared that she was censoring “everything” because “the joke has gone on long enough”. LR rejects the suspension of the pension reform, a measure which was suggested by Elisabeth Borne, who had nevertheless carried out this reform when she was Prime Minister. While, for his part, the president of the Socialist Party, Olivier Faure wants assurances on the suspension of such a reform.
“If the markets do not send a major warning signal, the urgency of providing them with a clear path in terms of public finances remains essential. For a year, no political consensus has emerged on the budgetary issue, and this uncertainty is reflected in a continuous rise in long-term interest rates. This phenomenon is not unique to France, but the absence of a credible course on reducing the deficit will penalize the country in the medium term. and long term”, warn the Asteres economists, who recall that “the Moody’s agency should also confirm this on October 24 by downgrading France’s rating. The urgency of providing a clear budgetary trajectory is real: we must not wait for the markets to send a more brutal signal to react.”
The Elysée confirmed last night, following the intervention of the resigning Prime Minister on France 2, that a new Prime Minister would be appointed within 48 hours.
The CAC in any case closed at 60 points above the threshold of 8,000 points, with the support of banks and luxury goods. It is outside of these sectors that the company which dominated the debates operates, however: Arcelormittal gained 6.55% after the European Commission proposed measures (quota cuts, doubling of customs duties) to limit steel exports to the European Union.
On the other side of the Atlantic, the main equity indices ended in mixed order, with tech breaking all records, with the Nasdaq Composite gaining 1.1%. The Dow Jones remained stable, while the S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, increased by 0.64% to 5,649 points.
An update on other risky asset classes: around 8:00 this morning
> On the foreign exchange market the single currency was trading at a level close to $1.1630.
> The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $62.50.
> THE Treasuries 10 years, yield on federal sovereign bonds maturing in 10 years, were trading slightly above the 4.13%.
> As for the VIX, it was worth 16.30 at the last close of the S&P500.
On the macroeconomic agenda this Thursday are weekly registrations for unemployment benefits, should the shutdown end by then. This paralysis of non-essential federal public services deprives trading rooms of important benchmarks, particularly on employment.
KEY GRAPHIC ELEMENTS
While the CAC had just overcome major resistance, on a wide gap (October 2), the session of October 6 changed the situation. The gap mentioned, although ample and formed on either side of the 8,000 points, can no longer be described as a rupture gap (breakaway gap). Which strongly calls into question the scenario of an immediate bullish extension towards 8,260 points.
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 8260.00 points would revive the buying tension. While a break of 7940.00 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.
