(BFM Bourse) – The Parisian index continues a second session of increase, gaining 0.6% the day after an increase of more than 2%. On Wall Street, the trend is more mixed, after the publication of solid macroeconomic indicators, making the prospect of future rate cuts a little more remote.
And two! Recording a second consecutive session of increase, the Paris Stock Exchange regained a little more ground this Tuesday evening. The CAC 40 gained another 0.59% to 7,489.35 points, therefore failing to preserve the threshold of 7,500 points reached a little earlier in the day.
On Monday, the Parisian index had its best session since the end of September, jumping 2.24%. The index was driven by information from the Washington Post reporting that the universal customs duties wanted by Donald Trump could be limited to certain sectors. The American president-elect may have called the article “fake news”, but the market took these hopes at face value.
“Good news is bad news”
In the United States, the atmosphere is a little more heavy, particularly after the publication of several statistics attesting to the robustness of the economy across the Atlantic. Firstly, on the activity front, growth in services accelerated more than expected in December. The ISM for services rose to 54.1 points, against a consensus of 53 points and after 52.1 points in November.
And it is the “prices paid” component that is making investors nervous, this having accelerated to its highest level since February 2023 to reach 64.4 points compared to 58.2 points in November.
“The price component of the ISM Services, which rebounds to its highest level since February 2023 (64.4 vs 58.2 the previous month), is not good news for the Federal Reserve and its president Jerome Powell which had already warned, in December, that a continued slowdown in inflation towards the target was the necessary condition for further rate cuts Knowing that underlying PCE inflation, in annual data, does not increase. has not made any further progress towards the objective for two quarters…”, notes Alexandre Baradez, head of market analysis at IG France.
At the same time, operators also took note of a higher than expected number of job offers at nearly 8.1 million, according to the Jolts report. “The rebound in the number of available jobs (Jolts figure) will also push the Fed to be patient because it removes possible fears linked to the job market, the Fed’s other mandate,” adds Alexandre Baradez.
“The bearish reaction of the American indices following the publication of these figures shows that the feeling ‘good news is bad news’ (good news is interpreted as bad, Editor’s note) has made a comeback and that the market ‘prefers’ “worry about the absence of further rate cuts rather than welcoming the good figures”, he concludes.
The reaction on the bond market was immediate, the yield on 10-year US government bonds is currently at 4.68%, compared to 4.61% Monday evening.
A little earlier today, market operators took note of inflation in the euro zone which came out in line with expectations in December, with an increase of 2.4% over one year. But “the persistent rigidity of services inflation in the euro zone means that the European Central Bank should continue to slowly reduce its interest rates, even if the economic outlook remains poor”, anticipates Capital Economics.
Alstom degraded, real estate companies praised
On the value side, Unibail-Rodamco-Westfield finished up 1.35% and, excluding the CAC 40, Mercialys gained 1.6%. The two real estate companies are among the eleven stocks in the sector on which Jefferies raised its advice in a sector note this Tuesday. The bank has noted to “buy” these two French stocks against “hold” previously.
On the SBF 120, Sodexo lost 7.8%, weighed down by activity clearly below expectations in the first quarter of its 2024-2025 financial year. Which brought in its wake Elior (-4.6%), another collective catering group.
Alstom is the other stock abandoned this Tuesday by investors (-4.35%), penalized by Goldman Sachs which lowered its advice to “sell” on the railway equipment manufacturer, not seeing any potential in the stock.
On the smaller values side, Riber ended up 4.5% after receiving a new order for a machine from one of its historic customers.
On other markets, the euro lost 0.2% against the dollar to 1.0366 dollars after the publication of robust statistics in the United States on Tuesday. Oil is moving forward. The March contract on North Sea Brent gained 0.8% to $76.90 per barrel while the February contract on WTI listed in New York gained 0.7% to $74.06 per barrel.
Sabrina Sadgui – ©2025 BFM Bourse
