CAC40 Sees Downturn but Stays Above 7400 Points Amidst Market Struggles

The Paris stock exchange, known as the Bourse, concluded its trading session with a 1.58% decrease, landing at 7411 points, even after a drop to 7380 points in the late afternoon. This downturn comes amidst a challenging day for major French companies like Alstom, which saw its shares plummet by over 10%, marking a 50% value decrease in the past quarter. Luxury goods conglomerate LVMH faced a 3.8% correction, with similar losses from Teleperformance at 3.7%.

Global Market Overview

Red hues painted the financial landscapes beyond France, with American indices such as the S&P 500 and Dow Jones both falling around 0.6%, while the tech-heavy Nasdaq Index dropped by 0.8%. Despite these setbacks, market experts maintain a hopeful outlook for equities and bonds in 2024, citing potentially promising returns.

Analyst Insights and Economic Indicators

Financial strategists expect the S&P 500 to aim for the 5,000-point threshold, indicating an optimistic forecast of about a 5% increase. When looking at Europe, analysts spot a sizeable discount in European equities compared to their U.S. counterparts, an imbalance anticipated to narrow in the future.

In economic trends, Germany reported an increase in jobseekers by 31,000 in December. Manufacturing activity in the U.S. showed a decelerating contraction, as indicated by a rise in the ISM index.

Bonds and Currency Markets

On the bond front, the 10-year German Bund rate hovered slightly over 2%, and the 10-year U.S. Treasury yield tightened at approximately 4%. In currency trade, the euro remained around $1.0910, with expectations of a weaker currency due to projected slow growth and potential monetary easing.

French Company News

French luxury group Kering saw its shares decline nearly 3%, while Renault reported outperforming the national automotive market in 2023. In the defense sector, Thales signed a contract to deliver medium-range ground radars to the Lithuanian Army. Nevertheless, UBS reduced its price target for Pernod Ricard, leaving a modest upside for the company's share value.

In addition, Alstom secured a contract worth over 500 million euros for an experimental tramway project in Saudi Arabia, indicating possible future recovery from its recent stock loss.

CAC40, Paris, Stocks