The Paris stock market has done its job: even if the initial gains have evaporated and the CAC40 is down -0.3%, equities are ending January on a high note, with the CAC40 setting a new record, testing the symbolic 7,700 mark (+2.2% year-on-year)... before settling back a little to 7,655.
The Euro-Stoxx50 is also consolidating (-0.3% to 4.650) after gaining 0.3% this morning, and setting a new all-time record of 4,674.7Pts: whatever happens, this January 31st will remain a historic date.

Since last October, the end of the calendar month has given rise to bullish rallies that increasingly resemble those of the '3 Witches' (when the underlying trend was positive), and the Dow Jones (+0.2% to 38.550Pts) looks set to set a 6th consecutive record (and that makes 8 since January 1st, with today's at 35,588).
The Nasdaq, on the other hand, is down -1.6%, in the wake of AMD (-3.1%) and Alphabet (-6.5%), while the S&P500 will also miss its turn for the record books, as it is down -0.8%.... but the 4,900 mark was broken 48 hours ago.

Optimism remains high on the interest-rate markets, which are easing significantly (see details below) as the Fed presents the conclusions of its strategy meeting this evening after the Paris market closes.

Fed Chairman Jerome Powell will also hold a press conference in the evening, a meeting that is traditionally closely followed by the markets, and all the more so at a time of uncertainty about the future of central bank monetary policies...

While the prospect of a 'status quo' is hardly in doubt, market participants will be trying to read between the lines and pick up any clues as to the pace and timing of rate cuts.

"The Federal Reserve is likely to put a clear end to hopes of a rate cut soon (March) and quickly", anticipates Emmanuel Auboyneau, associate manager at Amplegest.

According to him, 'Jerome Powell will try to calm things down, while keeping the door open for future meetings, depending on the economic data'.

Meanwhile, investors took note of the 'ADP' barometer of employment in the US private sector: +107.000 new hires in January, well below economists' expectations (of around 150,000 according to Jefferies), but also down sharply on the previous month's 158,000 (revised from 164,000 in the initial estimate).

There were also 'figures' this morning in Europe: a further fall (-1.8%) in French industrial producer prices (PPI) in December over one year, after -0.5% in November.
Insee specifies that PPI are virtually stable (+0.1% after +0.2% in November) excluding energy.

Also according to Insee (provisional estimate), consumer prices in France are set to rise by 3.1% year-on-year in January 2024, down significantly from 3.7% in December 2023.

Finally, the German economy contracted in the fourth quarter, according to a new estimate published by the Federal Statistical Office, with GDP down by 0.3% in the last three months of the year compared with the previous quarter in seasonally-adjusted terms, in line with an initial estimate made public on January 15.
There were also 'stats' in China this morning, and the economy remains in contraction territory, with manufacturing activity contracting for the 4th consecutive month in January: the manufacturing PMI stood at 49.2 in January, compared with 49.0 in December.

Chinese indices continued their correction, with -1.4% to -1.5% in Shanghai and Hong-Kong, -5.7% in Shenzhen... which is now down -16% since January 1.

On the bond front, OATs and Bunds once again reversed course and, for the 3rd consecutive session, shifted 7pts in the opposite direction to the previous day: our OATs thus eased to 2.653%, Bunds by -8pts to 2.158% and across the Atlantic, T-Bonds poured into euphoria with -10.3pts to 3.9520% a few hours before the FED statement.
The easing of rates propelled gold towards $2,055, 1% away from the historically high resistance level of $2,077.
The Dollar - less well rewarded - corrected without intensity, by -0.2%, while the Euro climbed back towards $1.0870.

In the news for French companies, Vivendi returned to its demerger project and is considering a division into four entities: Canal+, Havas, a company combining publishing and distribution assets (interests in Lagardère and Prisma Media) and an investment company (financial interests in culture, media and entertainment).

Nexans informed the markets that the French competition authority (Autorité de la Concurrence - AC) on Tuesday carried out searches at three of its sites in France, without specifying which ones. According to the group, these operations are part of an investigation targeting the energy cable distribution sector in the French overseas departments and territories.

Finally, last night, Groupe Seb indicated that it expected to achieve sales of 8006 ME in 2023, with organic growth of 5.3%. This performance is in line with the Group's target of organic sales growth of around 5% in 2023.

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