Paris Stock Exchange has experienced six consecutive sessions of gains, with the CAC40 index surpassing 7,650. Growth is driven by the luxury sector, notably LVMH and Hermès. In the US, markets reopened with mixed results; the Dow Jones rose 0.7% while the Nasdaq showed minimal gains. Economic indicators revealed a drop in manufacturing activity and worsened sentiment in Germany. Additionally, corporate developments include Thales Alenia Space’s new project and Renault Group’s CFO appointment.
Paris Stock Exchange Continues to Climb
The Paris Stock Exchange is riding high with a sixth consecutive session of gains, reflecting an increase of approximately 0.4% to 0.5%. The CAC40 index has successfully surpassed the 7,500 and 7,650 mark, now aiming for the 7,770 level, with an eye on the significant peak of 7,800, which was last tested on September 27. The luxury sector, led by notable performances from LVMH and Hermès, is a key driver of this rise, contributing to a 2.5% increase for these brands. Since the start of the year, the CAC40 has already exhibited an impressive annual growth of over 5%, significantly outperforming the Euro-Stoxx50, which has remained relatively stagnant with a slight decline of 0.1% at 5,155/5,160 points.
US Market Reopens with Mixed Results
The trading session today has proven to be more dynamic than the previous day, particularly with the reopening of the New York markets after a three-day weekend. The US indices have seen moderate gains, with the Dow Jones up by 0.7% and the S&P500 by 0.5%, while the Nasdaq has shown a minimal increase of 0.1%, pending Netflix’s earnings report tonight. In his inauguration speech, Donald Trump reiterated his commitment to prioritizing American interests but left many details regarding new tariffs somewhat ambiguous.
Bruno Lamoral, a portfolio manager at DPAM, suggests that equity investors are optimistic, anticipating that promised tax cuts and deregulation will enhance corporate profits. Christopher Dembik, an investment strategy advisor at Pictet AM, reminds us that Trump’s first presidency was characterized by significant financial volatility, yet also a robust 68% rise in the S&P 500.
On the economic front, the latest statistics from the US revealed a decline in the ‘Philly-FED’ manufacturing activity index, dropping to -9.1 from -3.4 in December. In Europe, the economic sentiment among financial market experts regarding Germany has worsened, as indicated by a decrease in the ZEW expectations index by 5.4 points to +10.3. This decline can be attributed to recent negative GDP growth figures and increasing inflationary pressures, as noted by Achim Wambach, president of the ZEW institute.
While the assessment of Germany’s current economic situation by financial market experts has shifted only slightly, the corresponding index has risen by 2.7 points to -90.4. With the US markets reopening, activity in the bond sector is picking up, leading to a positive day for bonds. The 2034 T-Bonds have decreased by 5.7 points to yield 4.547%, which in turn has eased the yield on the German ten-year Bund by 2 points to 2.47%. The yield on OATs of the same maturity has also fallen by 3 points to 3.269%, along with Italian BTPs at 3.600%.
In the oil markets, Brent crude has seen some profit-taking, trading around $79.4, down 0.85%. Meanwhile, the Euro has weakened by 0.2%, retreating towards 1.0380 against the US dollar.
In corporate news from France, Thales Alenia Space and Hispasat have announced the initiation of the development, manufacturing, verification, and validation phase for the QKD-GEO prototype, a Spanish quantum key distribution system from geostationary orbit. Lacroix has also revealed the sale of its City-Mobility segment to Swarco, with the transaction expected to close by the end of the first quarter of 2025 at the latest. Lastly, Renault Group has appointed Duncan Minto as the new Chief Financial Officer, effective March 1, succeeding Thierry Piéton, who will depart on February 28 for a new professional opportunity.