Paris Stock Exchange fell 0.8% to 7,135, while European markets lagged behind US indices. Wall Street’s S&P 500 dipped 0.4%, influenced by strong US economic indicators, including a revised 2.8% GDP growth for Q3. The PCE index rose 2.3% year-on-year in October. Unemployment claims slightly decreased, but those receiving benefits increased. The Federal Reserve remains flexible on monetary policy, while the dollar weakened against the euro. Oil prices remained stable amid geopolitical tensions.
Market Update: Paris Stock Exchange and Wall Street Trends
The Paris Stock Exchange experienced a decline of 0.8%, closing at 7,135, marking a significant dip below the 7,200 threshold. However, it managed to stay well above its mid-day lows, which reached 7,095 (-1.2%). European markets continue to lag behind US indices, with an average drop of 0.7%. The Euro-Stoxx50 is precariously close to the vital support level of 4,730, while Wall Street saw a slight decrease of 0.4% on the S&P 500.
US Economic Indicators and Their Impact
Wall Street’s sluggishness is partly attributed to the release of a series of robust American economic indicators, surfacing just ahead of the Thanksgiving holiday. The most crucial macroeconomic figure was the GDP, which was revised to show an annualized growth of 2.8% for the third quarter. The Department of Commerce noted that while investments saw an upward revision, this was counterbalanced by a downward adjustment in exports and consumer spending.
Among the anticipated figures, the US Personal Consumption Expenditures (PCE) index rose by 2.3% year-on-year in October, matching expectations after a 2.1% increase in September. In terms of core inflation, it climbed by 2.8% annually, consistent with forecasts and up from 2.7% in September.
The Department of Labor reported 213,000 new unemployment claims for the week of November 18, a slight drop of 2,000 from the previous week’s total, which was revised from 213,000 to 215,000. Additionally, the number of individuals receiving unemployment benefits rose by 9,000 to 1,907,000, reaching its highest level since November 2021.
Sales promises in the US saw a surprising increase of 2% in October, defying expectations of a 2.1% decline, following a substantial 7.5% rise in September. Durable goods orders also showed resilience, rising by 0.2% from September to October, recovering from a 0.4% drop in September. Excluding the transportation sector, durable goods orders increased by 0.1% on a sequential basis. However, deliveries from the American manufacturing sector fell by 0.6% month-on-month, largely due to decreased defense deliveries.
The minutes from the latest Federal Reserve meeting, released last evening, indicated that the central bank has not set a specific course for its monetary policy, remaining highly responsive to economic developments. The yield on the US ten-year Treasury bond fell by 4 basis points to 4.265%, while the two-year bond decreased by 3 basis points to 4.224%. In contrast, German bonds of the same maturity also saw a decline of 3 basis points to 2.166%, with French OATs dropping slightly to 3.0190% and Greek ten-year yields slipping below 3.03%. This has resulted in a widening spread between German Bunds and French OATs, reaching 87 basis points, the widest since June 9.
On the currency front, the dollar saw corrections after testing the 1.0465/E mark on Tuesday. Consequently, the euro strengthened by 0.7%, hovering around 1.0560 against the US dollar. In the energy sector, the oil market remains largely unaffected by the recent ceasefire in Lebanon, with Brent crude stable around $73 and West Texas Intermediate (WTI) gaining 0.2% to $68.9.