(CercleFinance.com) – The Paris Stock Exchange is quietly moving towards an increase of +1%, with a CAC40 returning to 8,000 after having accelerated sharply upwards at 2:30 p.m. (publication of a mediocre ‘NFP’) .
The US indices gained +1.2% (S&P500) to +1.8% (Nasdaq) instead of +0.6 to +0.8% anticipated, once again demonstrating that ‘bad news is bad news’. good news’ since the main issue once again becomes the prospect of monetary easing by the FED (from September) and not the good health of the American economy.
The ‘NFP’ (employment report) came out 30% below expectations: the American economy generated only 175,000 non-agricultural jobs in the month of April, according to the Department of Labor, a number well below the expectations of the market which averaged around 250,000.
The unemployment rate increased by 0.1 point to 3.9%, where economists had hoped for stability at 3.8%, while the labor force participation rate remained at 62, 7%, and that average hourly income increased at an annual rate of 3.9%.
In addition, the creations of non-agricultural jobs for the previous two months were revised, from 270,000 to 236,000 for February and from 303,000 to 315,000 for March, for a total revision balance of -22,000 for these two months.
‘Job creations were once again surprising with their strength in the first quarter, with 276,000 creations per month on average’, recall the Oddo BHF teams.
The latest NFP also removes the risk of salary overheating with an increase of +3.6% in hourly wages.
Growth in the American private sector slowed less than initially estimated in April, according to the S&P Global composite PMI index which ultimately stood at 51.3, compared to 50.9 in the flash estimate, and after 52.1 for the previous month (operators will note that it deteriorates by -0.8 over 1 month, which is in the direction of a slowdown).
Finally, activity in the American services sector plunged back into contraction territory in April, a first since the end of 2022, according to the results of the monthly survey of the Institute for Supply Management (ISM) among directors of purchases.
After 15 consecutive months of growth, the ISM index measuring the evolution of the tertiary sector fell to 49.4 last month, falling below the threshold of 50 points reflecting a decline in activity, compared to 51.4 in March.
The bond markets applaud these ‘weak’ US figures, with -5Pts on the ’10 year’ at 4.52% (compared to 4.70% at the start of the week), the ‘2 year’ erases -7Pts at 4.807% (compared to 5.00% last Friday).
In Europe, our OATs and Bunds also relaxed by -5Pts to 3.005% and 2.5030% respectively.
The emerging slowdown continues to weigh down the oil sector with a barrel of Brent losing another 0.5% to $83.4, or -6.5% weekly.
Gold, which briefly fell below $2,300 around 3:35 p.m. ($2,281), recovered towards 2,295 and lost 1.5% weekly.
The Dollar is clearly weakened with a decline of -0.4%, the Euro progressing symmetrically towards $1.0765.
An element of support for the Parisian stock market, Société Générale this morning revealed a group share of net income down 21.7% to 680 million euros for the first quarter, well above the consensus which was only targeting 475 million.
Crédit Agricole SA reveals underlying net income group share (RNPG) up 54.7% to 1.93 billion euros for the first quarter of 2024, as well as underlying gross operating income in sharp increase of 36.1% to 3.15 billion.
Legrand publishes net income group share (RNPG) down 16.5% for the first three months of 2024, to 275.9 million euros, with an adjusted operating margin before acquisitions down 1.6 points at 20.6% of sales.
Maurel & Prom announces that the board of directors will finally submit to the AGM of May 28, a dividend of 0.30 euros per share for 2023, instead of an initial proposal for a stable dividend of 0.23 euro announced alongside its annual results.
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