2023-10-06 08:41:44
The Paris Stock Exchange was up Friday morning, taking a breather in a negative week for the stock market, before the publication, later in the session, of a report on employment in the United States.
The flagship CAC 40 index gained 34.46 points to 7,032.71 points (+0.49%). The day before, the CAC 40 had finished stable at 6,998.25 points, remaining below the 7,000 point mark for the third consecutive session.
“All eyes are on the September American employment reports published this followingnoon, because they might determine whether or not the Fed (American central bank) will increase its rates one last time,” said Xavier. Chapard, from the LBP AM research and strategy team.
“Indeed, now that inflation is slowing more significantly and financial conditions are clearly restrictive, the factor that might decide the Fed to be more or less restrictive than indicated in September is the evolution of tensions on the financial market. “employment”, he continues.
Thus, for investors, the bad news will turn out to be rather good news for the markets in the wake of the restrictive monetary policy carried out by the Fed to reduce inflation to 2% and the next meeting of the institution in November.
The prospect of the Fed’s key interest rates remaining high over a long period has notably contributed to the surge in bond yields and “a further push upwards in rates cannot be ruled out if US employment data are stronger than anticipated for September”, comments Mr. Chapard.
On the bond market, rates started to rise slightly once more: the yield on 10-year US government bonds stood at 4.74% around 10:25 GMT, compared to 4.72% the day before at the close.
In Europe, the German rate for the same maturity moved to 2.90% compared to 2.88%, and that of France to 3.49% compared to 3.46%.
“While the rise in 10-year rates had almost stopped between October 2022 and spring 2023, it has resumed by around 100 basis points since June, more than half of which in the last three weeks,” explains Bruno Cavalier, chief economist for Oddo BHF.
Crédit Agricole on the rise
The Crédit Agricole bank posted the strongest increase in the CAC 40 around 10:20 a.m., up 2.14% to 11.66 euros following announcing the day before the launch of a share buyback program which began on Friday.
Alstom remains in the red
Alstom’s shares fell 2.31% to 13.09 euros on Friday following experiencing a real black Thursday the day before. Its shares slumped 37.58% following the world’s second-largest railway maker revealed excessive cash burn in the first half, with investors fearing it might portend further problems.
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