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Cac 40 maintains bullish course following Eurozone activity indicators sanctioned by Alstom after publication

The Paris Stock Exchange erased its decline from the previous day and was inspired by new highs reached by the S&P 500 and Nasdaq 100 in the close. But as John Plassard de Mirabaud writes: โ€œ the temptation to “withdraw” from the markets ยป could rise among investors on the eve of the European Central Bank meeting and the first estimate of US GDP in the fourth quarter.

A somewhat smaller-than-expected improvement in private sector activity in the euro area does not undermine the market recovery initiated at the opening. The composite PMI, a composite of manufacturing and services calculated by S&P Global, rose 0.3 points to 47.9 in January, a six-month high, according to a preliminary estimate. The Bloomberg consensus was at 48. Contraction in services increased very slightly, while manufacturing contracted. On the price side, headline inflation in the cost of goods and services rose to its highest level since May.

That was largely driven by services, where net hiring rose and sales prices rose at the fastest pace since June. This situation will concern the ECB, particularly focused on services inflation as an indicator of price pressures, responded Bradley Saunders, an economist at Capital Economics. Overall, the January PMIs confirm our view that weak demand will weigh on the economy for some time to come, but the strength of price pressures will prompt policymakers to wait until the second quarter before cutting interest rates. “.

Around 10:30, the Cac 40 gained 0.44% to 7,420.63 points on a trading volume of 500 million euros.

Netflix subscribers are growing more than expected

Nasdaq 100 futures were up about 0.7% this morning, led largely by Netflix’s 9% jump in over-the-counter transactions. The global video streaming giant managed to attract 13.1 million subscribers during the fourth quarter, stronger growth than the consensus analysts expected of nearly 9 million. Performance made possible by the end of password sharing, advertising formulas to increase group income, and a solid program offering.

Today’s session will focus on several leading US companies such as Tesla and IBM, but we’ll have to wait until the close of Wall Street for that, while numbers from telecommunications group AT&T will emerge in the early afternoon.

Robust U.S. economic growth, strong earnings and the prospect of a Federal Reserve rate cut continue to support equity valuations, although record highs and near-overbought market conditions for the S&P 500 call for โ€” at least โ€” a minor near-term correction. Tesla will release its latest results today, and they’re unlikely to be as glamorous as Netflix’s. But overall, investors don’t want to miss Wall Street’s rise to new heights. And if the trend is your friend, the trend is clearly positive said Ipek Ozkardeskaya of Swissquote Bank.

China reduces banks’ foreign exchange reserves

In Asia, Hong Kong’s Hang Seng accelerated to 4% after the People’s Bank of China announced at the end of the session a reduction in the amount of liquidity banks must hold in reserves from February, a measure designed to boost the economy. The index has also already been boosted by a surge in Alibaba, whose founder Jack Ma has reportedly bought $50 million worth of shares in the Chinese e-commerce giant, according to press reports.

The morning will be punctuated by the January PMI indices on activity in the services and manufacturing sectors in the Eurozone. According to the Bloomberg consensus, an improvement can be expected, but so weak that the numbers should have remained below the 50 mark, which characterizes the contraction zone. At 4 p.m., the same indexes will be released for the United States. The Bank of Canada is expected to leave its key rate unchanged at the end of its afternoon session, a path the Bank of Japan took yesterday and which the ECB is expected to follow tomorrow.

Alstom’s publication was poorly received, SAP sets record

Europe has no shortage of publications. French rail group Alstom lost 4.5% after posting organic growth of 4.6% in the third quarter.

In the tech world, ASML, a major supplier of equipment to the semiconductor industry, rose 6.5% after reporting better-than-expected quarterly net profit and revenue at the end of the year, fueling momentum in its China business. Shares of SAP (+6%) hit an all-time high as the German software publisher reported rising revenue and announced a plan to restructure 8,000 jobs, or 7% of full-time employees, to support growth in artificial intelligence.

In London, airline easyJet gained more than 4.6% after it said it expected smaller first-half losses.

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