CAC 40: caution when returning from the Easter long weekend

( – The Paris Stock Exchange should begin without any major trend on Tuesday morning, for its first session since the publication on Friday of rather reassuring inflation figures in the United States.

Around 8:15 a.m., the ‘future’ contract on the CAC 40 index – April delivery – gained 5.5 points to 8,229 points, suggesting a little changed opening.

The so-called ‘core PCE’ inflation index, which excludes the volatile elements such as energy and food products, increased by 2.8% on an annual basis in February, compared to an increase of 2.9% in January.

This is its lowest level since 2021, that is to say when the first inflationary tensions began to appear after the Covid crisis.

These figures – which confirm the slowdown in inflation across the Atlantic – could encourage the Federal Reserve to soon lower its rates.

The statistic was released Friday as Wall Street and European stock markets were closed for Good Friday.

Despite this better-than-expected statistic, Wall Street started the second quarter on a relatively dull note yesterday, with the Dow Jones having lost 0.6% and Nasdaq Composite having gained 0.1% against a backdrop of fairly mixed signals from the American manufacturing sector.

Back in front of their screens after the long Thanksgiving weekend, European investors should be cautious before a week full of economic indicators and speeches from Fed officials.

The US employment figures, which will be released on Friday, will probably not be enough to alter expectations of rate cuts, but could provide more insight into the pace of the Fed’s future monetary easing.

On the indicators front, investors will learn tomorrow the ISM services index in the United States, as well as the latest inflation figures in the euro zone.

Jerome Powell, Chairman of the Fed, will also speak on Wednesday on the economic outlook during a forum organized by Stanford University (California).

A new episode of tensions between Israel and Iran is also driving up oil prices and safe haven assets following strikes carried out by the IDF on the Iranian consulate in Damascus, which left several dead.

This renewed tension, which raises fears of an escalation in the Middle East, is reflected on the markets by a rise in oil prices, with a barrel of American light crude oil (WTI) increasing by 0.5% to more than 84.1 dollars.

Gold, government bonds and the dollar are also trending favorably.

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