Paris Stock Exchange remains stable with the CAC40 index slightly up, driven by Société Générale’s strong performance. European markets show robust trends, with Euro-Stoxx50 hitting an all-time high. Investors await insights from Fed Chairman Jerome Powell regarding interest rates amid mixed economic signals. In corporate news, Kering reported a significant drop in net income, while EssilorLuxottica acquired a Canadian startup. Thales signed a contract to enhance India’s air defense capabilities.
Paris Stock Exchange Holds Steady Amid Wall Street Reopening
Despite the reopening of Wall Street, the Paris Stock Exchange remains steady, fluctuating around the 8,010 to 8,020 points mark. The CAC40 index has experienced a slight increase of 0.2% to 0.3%, mainly driven by the performance of Société Générale, which has surged by 3.8% and is approaching its all-time highs near 36.6€. Other notable gainers include Essilor, which rose by 1.8%. However, the index faced some headwinds from Carrefour and Eurofins, both of which dipped by 1.6%.
European Markets Exhibit Robust Trends
While investors appear to be biding their time in anticipation of new developments regarding trade and customs relations, the upward momentum in Europe remains strong. The Euro-Stoxx50 has recorded a remarkable increase of 0.6%, setting a new all-time high at 5,390, contributing to a substantial 10% gain over the last five weeks. This robust performance suggests a promising trajectory for the year ahead, with expectations of continuing growth.
Similarly, the Dax40 is poised to achieve new milestones, aiming for all-time intraday and closing records above 22,000 points. Currently, the three main indices on Wall Street are balancing out after initially erasing their gains, reflecting a state of equilibrium.
Market analysts from Danske Bank noted that participants have adapted well to the renewed volatility surrounding Trump’s return, with many expecting the recent measures. A key factor supporting stock prices is the lack of escalation in trade tensions, as major U.S. trading partners have not enacted retaliatory measures.
In this environment of relative stability, investors are keenly awaiting Federal Reserve Chairman Jerome Powell’s testimony before the Congressional Financial Services Committee. Following mixed employment data released last Friday, traders are eager for clarity on the Fed’s stance regarding interest rates and the broader economic outlook.
Particularly, investors are interested in whether a rate cut in June or July remains a viable option despite the inflationary pressures stemming from Trump’s protectionist policies. Economists from Oddo BHF predict that if questioned about the Fed’s position on tariff policies, Powell’s response will likely be a cautious “wait and see.”
In bond markets, the yield on 10-year U.S. Treasury bonds has risen by 4 points to 4.536%. Meanwhile, the Bund for the same maturity increased by 7 points to 2.4310%, and the OAT saw a slight deterioration of 7.5 basis points to 3.16500%, resulting in a marginally unchanged spread of 73 points compared to 72.5 on Monday.
The euro has appreciated by 0.35% against the dollar, hovering around 1.0340$, while oil prices are showing signs of a technical rebound after a downward trend since January 15, with Brent crude rising by 1% to nearly $77 per barrel.
In the latest developments concerning French corporations, Kering reported a significant drop in net income attributable to the group, falling 62% to 1.13 billion euros for 2024, alongside a 46% decrease in current operating profit to 2.55 billion euros, resulting in a margin decline to 14.9% from 24.3% in 2023.
EssilorLuxottica announced its acquisition of Cellview Imaging Inc, a Canadian startup in Toronto that specializes in the design and manufacturing of advanced imaging diagnostic instruments, leveraging strong internal R&D capabilities.
Additionally, Thales has signed a contract with Bharat Dynamics Ltd (BDL) for the initial supply of portable air defense systems (LBRM) to enhance India’s air defense capabilities.