Paris Stock Exchange is seeing a decline, with the CAC40 index down 1% amid mixed performances from major companies. In Germany, the DAX index stabilizes after a conservative coalition victory in elections. Analysts note limited euro movement, suggesting the results were anticipated. This week, significant quarterly earnings reports from major firms like Nvidia and Home Depot could influence market trends. Meanwhile, bond yields are slightly down, and gold prices are rising, reflecting a cautious economic outlook.
Paris Stock Market Trends
The Paris Stock Exchange is experiencing a notable decline, with the CAC40 index dropping by 1% to approximately 8,070 points as Wall Street opens its trading session. The morning began with volatility, as the CAC40 fluctuated between 8,150 and 8,100 points before settling at a slight decrease of around -0.25%.
U.S. market indices, which initially opened on a positive note following significant losses on Friday, have also retreated. The S&P500 has decreased by 0.4%, and the Nasdaq has fallen by 1.1%, while the Dow Jones remains relatively stable. Notably, the CAC40 has been impacted by declines in major companies like Schneider Electric (-6%) and Legrand (-3%), but gains in firms such as Veolia and Carrefour (+3.2%) and Airbus and Thales (+2.2%) have provided some support.
German Election Results and Market Reactions
In Germany, the DAX index, which saw a 1% increase earlier in the day, has returned to stability with a minimal gain of 0.1%. This shift follows the conservative coalition’s victory in the German legislative elections, a result that has alleviated some concerns regarding increased political risks in Europe. The CDU/CSU alliance secured 28.6% of the votes, outpacing the far-right AfD party at 20.8% and the Social Democrats (SPD) at a historic low of 16.4%.
Market analysts note that the relatively muted reaction of the euro, which remains steady at $1.0462 after the election results, indicates that the markets had already priced in the outcome. The CDU/CSU is generally perceived as business-friendly, leading to optimistic sentiments among investors who now question their ability to govern effectively without a substantial majority.
This week is poised to be significant as major companies prepare to release their quarterly earnings, beginning with Nvidia on Wednesday. Investors are hopeful for positive results that could reassure them about the ongoing growth in AI investments, which has been a driving force for Wall Street over the past year and a half. Other notable companies, including Home Depot and Salesforce, are also set to share their financial performance in the coming days.
In addition, several leading European corporations such as Anheuser-Busch InBev, Allianz, AXA, BASF, Danone, Deutsche Telekom, Saint-Gobain, and Stellantis will report their quarterly results, potentially influencing market trends.
On the economic front, Germany’s business climate index remained unchanged at 85.2 for February, reflecting a cautious outlook among companies ahead of the recent elections. The IFO institute’s report indicates that expectations were slightly higher at 85.4, showcasing a prevailing skepticism among German businesses.
In the bond market, German Bunds are showing a slight decrease, yielding approximately 2.4600%, while French OATs have also declined to around 3.213%. Across the Atlantic, as Wall Street falters, T-Bonds are benefiting from a risk-off sentiment, with yields decreasing to 4.388% for 10-year bonds and 4.65% for 30-year bonds. Gold prices have surged to new heights, testing $2,973 per ounce for April contracts, while oil prices remain stable around $74.3.
In corporate news, Sanofi and Teva Pharmaceuticals have released new findings from their phase IIb RELIEVE UCCD study focused on duvakitug for patients with moderate to severe ulcerative colitis and Crohn’s disease. Atos has secured a project management assistance contract for information systems security from the Hospital IT Purchasing Center (CAIH). SES has announced a partnership with Quvia, an AI-driven company specializing in quality of experience management, while Thales has signed a memorandum of understanding with Qatar Airways to establish a center in Doha for in-flight entertainment services.