(BFM Bourse) – The Parisian index ended sharply higher on Tuesday, while Wall Street rebounded thanks to a lull in rates and good company results. Hermès stood out after activity above expectations in the third quarter.
The gloom takes a break on the Paris Stock Exchange. After gaining 0.5% the day before, the CAC 40 gained 0.63% this Tuesday, returning to 6,893.65 points.
Down in the morning, the Parisian index was driven by the good performance of Wall Street. Shortly before the European markets closed, the S&P 500 gained 1%, well on its way to ending a series of five successive declines.
American indices are helped by the decline in bond yields. The yield on the 10-year US Treasury bond remains at a contained level at 4.88%, after exceeding 5% during the day on Monday.
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Coca-Cola and GE impress
Corporate results are also supporting the American markets. Coca-Cola rose 3% after publishing earnings per share above expectations and raising its forecasts for the current financial year. Verizon (+8.6%), General Electric +(7.3%) and 3M (+5%) also delivered publications that delighted Wall Street.
In terms of indicators, market operators took note of the fall in the PMI Composite index, which measures private sector activity, for the month of October in the euro zone. At 46.5 compared to 47.2 in September, this index fell below the consensus of 47.4 (a level below 50 marks a contraction in activity, when a level above 50 indicates a expansion of activity).
“These surveys do not change our view that the eurozone economy is expected to contract in the fourth quarter, after having probably contracted in the third quarter (data will be released on Tuesday October 31). Nor do they change the situation ahead of the European Central Bank meeting later this week, at which the Governing Council appears certain to leave interest rates unchanged,” concludes Capital Economics.
Hermès meets expectations
On the value side, Hermès finished at the top of the CAC 40, gaining 2.8% thanks to growth clearly above expectations in its third quarter, once again illustrating the resilience of the saddler.
Airbus gained 2.2%. Raytheon Technologies delivered a message deemed reassuring by Jefferies regarding the problems with the GTF, the engine of its Pratt & Whitney division, which powers Airbus’ A320 neo planes. “The absence of additional negative elements from Raytheon probably contributed to strengthening opinion on the delivery potential of Airbus in 2024,” underlines Jefferies.
Outside the CAC 40, Virbac (+11.2%) delighted the market with a rebound in its sales in the third quarter and an increase in its annual objectives. Interparfums, for its part, lost 6.1%, with the group’s management showing caution for the coming quarters after noting a slowdown in its momentum since mid-summer.
On the foreign exchange market, the euro lost 0.8% to 1.0587 dollars. On the oil side, investors are assessing the situation in the Middle East, and seem to believe that the conflict between Israel and Hamas will remain contained, notes Bloomberg. As a result, prices fell: the barrel of North Sea Brent for December fell by 2.2% to 87.90 dollars per barrel. That of the same maturity on WTI listed in New York dropped 2.4% to 83.38 dollars per barrel.
Julien Marion – ©2023 BFM Bourse