The Paris Stock Exchange is stable this morning, with the index around 7,490 points, driven by gains from Edenred and Thales, despite losses from Eurofins Scientific and L’Oréal. Economic data shows an improved French trade balance and a decline in German manufacturing orders. Market participants await insights from the Federal Reserve’s recent meeting, while bond yields rise in response to U.S. economic indicators. In corporate news, Trigano reports a revenue drop, Solutions30 expands in Poland, and Vallourec achieves zero net debt.
Stable Morning at the Paris Stock Exchange
The Paris Stock Exchange is experiencing a stable morning with the index hovering around 7,490 points. This stability is fueled by notable gains from Edenred, which saw a rise of 4%, and Thales, up by 3.1%. However, the market faces some challenges, with Eurofins Scientific declining by 3% and L’Oréal dropping by 1.6%.
Key Economic Indicators and Market Reactions
This morning, several important economic statistics were released, including France’s trade balance. In November 2024, the trade deficit improved according to CVS-CJO data from the customs administration, decreasing to €7.08 billion from €7.52 billion the previous month. This improvement is attributed to a 2.9% increase in French exports, which reached €50.1 billion, while imports only rose by 1.7%, totaling nearly €57.2 billion during the same timeframe.
Meanwhile, in Germany, the manufacturing sector reported a 5.4% decline in order volumes for November 2024 compared to the previous month, following a contraction of 1.5% in October, as per seasonally and calendar-adjusted data from Destatis.
Market participants are now eagerly awaiting the release of the ‘minutes’ from the Federal Reserve’s meeting held on December 17 and 18. This meeting resulted in a quarter-point reduction in interest rates, and traders are looking for insights into the discussions within the FOMC and potential future rate cuts.
The market is currently navigating mixed signals. Fed Chairman Jerome Powell has emphasized a cautious approach and hinted at entering a ‘new phase’ characterized by fewer easing measures. In contrast, other committee members appear more open to potential actions.
Traders are not expecting another rate cut until June, with a second one anticipated by the year’s end. However, the upcoming ‘minutes’ may provide clarity on the Fed’s future intentions, potentially reigniting discussions about the possibility of three rate cuts in 2025.
In the afternoon, the market will also digest the results of the ADP employment survey in the private sector, along with the weekly jobless claims data in the United States, which are expected to affirm the robustness of the American labor market.
On the bond markets, the yield on ten-year U.S. Treasuries has risen by 6.5 basis points to 4.68%, having surpassed the 4.70% mark last night following the release of strong economic indicators in the U.S. Eurozone bond yields are also on the rise, with the ten-year German Bund yielding 2.47%, while the French OAT of the same duration climbs to 3.30%.
In corporate news, Trigano has reported a revenue decline of 17.4%, totaling €769.8 million for its first quarter of 2024-25, which concluded in late November. This marks an 18% decrease when adjusted for constant perimeter and exchange rates compared to the same period last year.
Solutions30 has announced plans to enhance its presence in Poland’s growing Electric Vehicle Charging Infrastructure (IRVE) market by securing contracts with key players in the region.
Finally, Vallourec has successfully achieved its goal of zero net debt a year ahead of schedule, reducing its net debt by over €240 million in the fourth quarter of 2024, marking its ninth consecutive quarter of debt reduction.