The control room of Euronext, the company that manages the Paris Stock Exchange (AFP/Archives/ERIC PIERMONT)
The Paris Stock Exchange ended up 0.65% on Tuesday, supported by the announcement of support measures in China and evidence of economic resilience, particularly in Germany where industrial orders are rebounding.
The flagship CAC 40 index advanced 49.01 points to 7,638.97 points. Monday, the CAC 40 finished at 7,589.96 points (-0.03%).
Chinese stock markets, shaken for several months due to concerns about the country’s growth, jumped after the announcement of Beijing’s support measures for the markets.
The Chinese government fund Central Huijin Investment, in charge of equity investments, announced on Tuesday that it was injecting new funds into financial markets.
Measures to “relaunch the Chinese market will not necessarily benefit European markets” but “any recovery initiative in China would benefit” the European economy, which “could export more to this market”, underlines Vincent Juvyns, member of the JPMorgan AM strategy team.
The Parisian rating is also driven by the observation that the economy is resilient despite high interest rates.
In Germany, industrial orders rebounded strongly in December over one month, by 8.9%, a good surprise for the largest European economy mired in a general slowdown in its activity, according to figures published Tuesday by the institute Destatis statistics.
On the monetary policy front, investors will be attentive to the speeches of American central bankers in the coming days.
The stock markets “are driven by hopes of interest rate reductions”, which had been qualified recently, recalls Vincent Juvyns.
“There have already been a lot of communications made in recent days and weeks” by members of the Federal Reserve (Fed) to tell the markets that they “misunderstood” the message from December, where the president of the Fed had mentioned discussions around rate cuts.
The markets have therefore reviewed their scenarios for rate cuts in 2024 and now anticipate that they will occur a little later and be fewer than previously anticipated.
On the bond market, the interest rate on 10-year French government bonds stabilized at 2.80% around 5:55 p.m. (4:55 p.m. GMT), compared to 2.81% at Monday’s close.
The industrial values sought after
After several indicators which show that the economy is not completely bending in the face of high interest rates, the shares of companies in the industrial sector, therefore activity is linked to the economic situation, were sought after on Tuesday.
Schneider Electric finished at the top of the CAC 40, with an increase of 2.77% to 193.20 euros. Behind him, Air Liquide gained 2.39% to 171.88 euros. ArcelorMittal, which also benefits from measures to support the Chinese economy, increased by 1.94% to 25.47 euros and TotalEnergies gained 1.82% to 60.30 euros.
The French oil and gas group was also supported by the results of BP, the British hydrocarbon giant, which returned to profit in 2023.
© 2024 AFP
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