The control room of Euronext, the company that manages the Paris Stock Exchange (AFP / ERIC PIERMONT)
The flagship index of the Paris Stock Exchange broke a new absolute record at the close on Friday, shining thanks to numerous company results, starting with that of the luxury giant LVMH.
The CAC 40 index finished at 7,634.14 points, well above its previous peak reached on December 15, at 7,596.91 points. However, it did not manage to erase its session high, 7,653.99 points, reached on December 14.
Its increase over one session is the largest since January 4, 2023.
It is mainly driven by the spectacular progress of LVMH, which rose more than 12% after the publication of its annual results, and had its best session since 2008.
LVMH is the largest company listed on the Paris Stock Exchange and is now worth more than 385 billion euros. Its weight in the calculation of the CAC 40 is all the more important: its variation accounts for more than 10% in the weighting of the index.
The session marks a return to favor for the stock, which had fallen by nearly 27% between mid-July and mid-January.
Monthly values since the creation of the index in 1988 (AFP / Sylvie HUSSON)
But the world number one luxury company presented annual results on Thursday which satisfied investors in all respects, unlike the cold reception given during the last two financial points, in July and October.
The year 2023 was “another record year”, according to the group which owns, among others, the Louis Vuitton, Dior, Tiffany and Moët & Chandon brands, with sales up 9% and net profit increasing by 8%.
The entire luxury sector has taken action, such as Kering (+7.85% to 384.80 euros), Hermès (+6.63% to 1,966.20 euros), or even in cosmetics with L’Oréal (+2, 94% at 445.10 euros).
– Fall in inflation –
In addition to LVMH, global stock markets are driven by the prospect of lower interest rates by central banks in 2024.
Graph classifying the 40 companies on the Paris Stock Exchange by sector and market capitalization, as of January 25, 2024 at the close (AFP /)
After having made a brutal monetary tightening, the clear slowdown in inflation is pushing them to now consider lowering their key rates.
Again on Friday, investors learned that inflation in the United States had stabilized at 2.6% in December in the United States according to the PCE index. The measure, which does not take into account energy and food prices, which are more closely watched by central banks, continued to decline.
Faced with a US economy that remains afloat despite interest rates at their highest all-time high, investors believe that central banks will succeed in bringing inflation back to the target of 2% while avoiding going through the recession box.
Euronext CAC40