CAC 40: Double political and monetary verdict, this week

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Friday, a public holiday but not a day off on the Paris Stock Exchange, the CAC gained 0.80% to 7,409 points, in discreet volumes in the absence of numerous operators. Operators thus ended three sessions of sharp decline, against a backdrop of warming in the American 10-year, while the United States widens the gap vis-à-vis the Old Continent, on the economic performance front. The week which opens will be marked by the verdict of the American ballot boxes, on the night of 05-06 if applicable, and by the outcome on the 7th of a new meeting of the Fed's Monetary Policy Committee.

In terms of statistics, the session was marked by the publication of the traditional NFP (Non Farm Payrolls) report on the health of private employment in the United States. During the month of October, the American economy created 12,000 jobs, against a target of 106,000. The unemployment rate remained stable at 4.1% of the active population, while the increase in average hourly wages s is posted at +0.4%, exceeding the consensus (+0.3%). However, it is difficult to draw decisive conclusions, in the sense that economic shocks have occasionally disrupted the employment landscape: the passage of hurricanes and strikes at Boeing.

On the values side, Société Générale once again gained 3.4% after having gained 11.3% the day before, following the publication of results significantly higher than expectations in the third quarter. Morgan Stanley raised its advice on the value to “overweight” this Friday. UBS, for its part, judges that the company delivered “a shock of confidence” with its results on Thursday.

Outside the CAC 40, Viridien (formerly CGG) lost 4.1% after announcing a 25% drop in its turnover in the third quarter.

On the other side of the Atlantic, the main equity indices ended Friday's session slightly in the green, like the Dow Jones (+0.69% to 42,052 points) or the Nasdaq Composite (+ 0.80% to 18,239 points). The S&P500, the benchmark barometer of risk appetite in the eyes of fund managers, gained 0.41% to 5,728 points.

An update on other risky asset classes: around 8 a.m. this morning on the foreign exchange market, the single currency was trading at a level close to 1,0890$. The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around 70,60$.

On the macroeconomic agenda this Monday, to follow as a priority the final data from the PMI activity barometers in the Euro Zone at 10:00 a.m. and the Sentix index of investor confidence in the monetary union, at 10:30 a.m.

Note that the East Coast of the United States has in turn switched to winter time, the opening of Wall will be again, and as usual, at 3:30 p.m.

KEY GRAPHIC ELEMENTS

The 7,465/7500 points gave way on Wednesday 30/10, on gap, in thick volumes, and in conditions of notable volatility. The short-term bearish message is thus mechanically validated. The next identifiable level is 7,340 points.

Note that Friday's session will have “saved” the appearance of the weekly candle.

PREVISION

Considering the key graphical factors that we have identified, our opinion is neutral on the CAC 40 index in the short term.

We will take care to note that crossing 7690.00 points would revive the buying tension. While a break of 7340.00 points would restart the selling pressure.