(CercleFinance.com) – After spending most of the session in positive territory – even setting a new absolute record at 7,702 points – the Paris Stock Exchange went into reverse in the second half of the afternoon, and saw its gains evaporate. At the final bell, the Parisian index shows a moderate decline of 0.27%, to 7656 points.
The Fed is at the center of attention this evening since it must present the conclusions of its strategic meeting. Jerome Powell, the president of the institution, will also give a press conference in the evening, a meeting traditionally closely followed by the markets, and all the more so in this period of uncertainty regarding the evolution of monetary policies. central banks…
While there is little doubt about the prospect of a ‘status quo’, stakeholders will try to read between the lines and detect possible clues as to the pace and timing of rate cuts.
‘The Federal Reserve will undoubtedly clearly put an end to hopes of a rapid rate cut soon (March)’, anticipates Emmanuel Auboyneau, associate manager of Amplegest.
According to him, ‘Jerome Powell will try to calm things down while keeping the door open for the next meetings, depending on economic data’.
In the meantime, investors have taken note of the ‘ADP’ barometer of employment in the private sector of the United States: +107,000 new hires in January, which is clearly below the expectations of economists (of the order of 150,000 expected according to Jefferies), but also down sharply compared to the 158,000 of the previous month (revised from 164,000 in initial estimate).
There were also ‘figures’ this morning in Europe: a further drop (-1.8%) in French industrial production prices (PPI) in December year-on-year, after -0.5% in November.
INSEE specifies that PPIs are almost stable (+0.1% after +0.2% in November) excluding energy.
Still according to INSEE (provisional estimate), consumer prices in France would increase by 3.1% over one year in January 2024, a rate down significantly after that of 3.7% observed in December 2023.
Finally, the German economy contracted significantly in the fourth quarter, according to a new estimate published by the Federal Statistical Office with GDP down 0.3% over the last three months of the year compared to the previous quarter in seasonally adjusted data, in accordance with a first estimate made public on January 15.
There were also ‘stats’ in China this morning and the economy remains in contraction territory with manufacturing activity contracting for the 4th consecutive month in January: the manufacturing PMI index stood at 49, 2 in January compared to 49.0 in December.
The Chinese indices continued their correction, with -1.4% to -1.5% in Shanghai and Hong Kong, -5.7% in Shenzhen… which has now lost -16% since January 1st.
On the bond front, Bunds eased by -8Pts to 2.158% and across the Atlantic, T-Bonds fell into euphoria with -10.3Pts to 3.9520% a few hours before the FED press release.
The easing of rates propels gold towards $2,050 per ounce, or +0.9%.
On the currency side, the euro remains stable against the greenback, at $1.08/euro.
In the news of French companies, Vivendi has returned to its split project and is considering a division into four entities, namely Canal+, Havas, a company bringing together assets in publishing and distribution (stakes in Lagardère and Prisma Media) and an investment company (financial interests in culture, media and entertainment).
Nexans informed the markets that the Competition Authority (AC) carried out searches on three of its sites in France on Tuesday, without specifying which ones. According to the group, these operations are part of an investigation targeting the energy cable distribution sector in the French Overseas Territories.
TotalEnergies says it has signed an agreement with OMV to acquire its 50% stake in SapuraOMV Upstream, a Malaysian gas producer and operator, for an amount valued at $903 million, subject to customary adjustments.
Airbus announces the signing of a memorandum of understanding with Avinor, SAS, Swedavia and Vattenfall to study the feasibility of hydrogen infrastructure at airports in Sweden and Norway.
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