European stock indices showed a positive trend on Monday, with the CAC40 surpassing 8,000, boosted by companies like Edenred and Schneider. In the US, indices also opened higher despite trade war concerns linked to Trump’s tariff announcement. As earnings season approaches its end, major US and European corporations are set to report results. Meanwhile, bond yields fell slightly, and gold reached a record price, with notable corporate developments in France including Saint-Gobain’s acquisition and Thales’s military contract.
Market Overview: A Positive Start for European Indices
This Monday unfolded differently compared to the previous two weeks, with no significant downturns affecting stock indices. In the morning, the Paris Stock Exchange hovered around its stability point. However, the anticipation of potential gains from the pre-market activity on Wall Street propelled the CAC40 index to surpass the 8,000 mark, achieving a rise of 0.2 to 0.3%. Key contributors to this surge included Edenred, up by 2.2%, and Schneider, which climbed by 1.7%. This positive trend is echoed across other European markets, which, after a somewhat lackluster start, began to show renewed enthusiasm, with the E-Stoxx50 gaining 0.4% and the DAX40 increasing by 0.5%, approaching its historical closing record of 21,913 from February 6.
US Market Reaction and Economic Outlook
As anticipated, US indices opened significantly higher, with the S&P500 up by 0.5% around 6,055 and the Nasdaq gaining 0.7%. Investor sentiment remains buoyant despite concerns arising from Donald Trump’s announcement regarding a 25% tax on steel and aluminum imports, which has sparked fears of a potential trade war with key allies. The market mood appeared unfazed by this news, which had previously caused a drop in the Dow Jones by 1% and a decline in the Nasdaq Composite of over 1.3% by Friday’s close. Economists remain wary about the long-term implications of these protectionist measures, warning of possible inflation and growth risks.
As the earnings season in the United States nears its conclusion, major corporations like McDonald’s, Cisco, and Coca-Cola are set to release their financial results shortly. Conversely, Europe is gearing up for a busy reporting period, with prominent companies such as BP—celebrating a 7% gain following the announcement of Elliott Fund’s investment—EssilorLuxottica, Heineken, Hermès, Kering, Legrand, Nestlé, Safran, Siemens, Unilever, and UniCredit expected to unveil their results soon.
On the bond market, US 10-year Treasury Bonds saw a slight decrease, yielding around 4.471%, while the German Bund of the same maturity stood at 2.352%. In the currency markets, the euro dipped by 0.2%, trading at $1.0310. Meanwhile, in London, Brent crude oil is priced at $75.4, reflecting a gain of 1%. Notably, gold reached a new record price of $2,910 per ounce, whereas silver lagged behind with a modest increase of 0.4% to $32.6.
In corporate news from France, Saint-Gobain reported a 0.7% decline as it announced the completion of its acquisition of FOSROC, a significant player in construction chemistry with a strong presence in India, the Middle East, and Asia-Pacific. Additionally, Maurel & Prom confirmed its definitive agreement with NG Energy International to acquire a 40% operated interest in the Sinu-9 gas permit in Colombia. Lastly, Thales announced the delivery of the first mine countermeasure drone system to the French Navy, marking a significant milestone in the Franco-British MMCM program.