The Paris stock exchange closed this final session of the week nearly unchanged (7,982 pts, +0.02%), buoyed by Capgemini (+3.5%) and Pernod Ricard (+3%), but held back by the defense sector, with Thales dropping 3.8% and Safran down 3.6%. These declines came as Donald Trump, the newly re-elected 47th President of the United States, outlined a potential peace plan regarding the Ukraine conflict. Over the past week, the Parisian index has...
While markets had begun to discount the likelihood of a Federal Reserve rate cut in December, John Williams, the influential dovish president of the New York Fed and a voting member of the Federal Open Market Committee, revived hopes by stating that "the Fed could still lower interest rates 'in the short term' without compromising its inflation target." This stance contrasts with recent remarks from his colleagues, who have cast doubt on a third monetary easing in December.
According to the CME FedWatch tool, expectations for a rate cut in four weeks have rebounded sharply, jumping from 35% to 70% probability.
Wall Street's response has been muted: the S&P 500 is up 0.4%, ahead of the Nasdaq (+0.2%).
The VIX, the CBOE volatility index known as the "fear gauge," experienced intraday swings of 36% on Thursday but retreated 2.2% to remain elevated at around 25.8.
After more than six months of almost uninterrupted gains, volatility appears to be making a comeback in the markets, potentially becoming the norm through year-end.
This renewed nervousness primarily highlights investors' waning confidence in the continuation of the Fed's rate-cutting cycle, which had previously seemed a given.
Yesterday's much stronger-than-expected US jobs report prompted investors to reconsider the likelihood of another rate reduction next month.
The morning in Europe was marked by the release of initial results from S&P Global's monthly PMI surveys of private sector purchasing managers.
The flash HCOB composite PMI for overall activity in the eurozone stood at 52.4 in November, edging down slightly from October's 52.5 but still indicating solid private sector growth.
In France, the flash HCOB composite PMI for overall activity rebounded from 47.7 in October to 49.9 this month, its highest level since August 2024, signaling near-stagnation in private sector activity for November.
The synthetic business climate indicator for France, calculated by Insee based on business leaders' responses, gained another point to reach 98 in November, drawing closer to its long-term average of 100.
With renewed uncertainties surrounding Fed policy likely to keep investors on edge, it seems unlikely that equity markets will regain the calm seen earlier this year.
With earnings season ending and US economic indicators returning after six weeks of government shutdown, investors are expected to focus on the American economy and the Federal Reserve, watching closely for any signs of a shift in economic conditions or monetary policy.
This could mean more turbulent times ahead for equities, and investors who have grown accustomed to "buying the dips" after recent brief pullbacks may find themselves disappointed this time around.
In the bond market, the French 10-year OAT yield fell -2 basis points to 3.466%, while the equivalent German Bund dropped -3 basis points to 2.689%, leaving a spread of 77 basis points.
In London, Brent crude slipped 1.65% to $62.2, while WTI dropped by a similar margin to around $58.
The euro continued to weaken against the dollar (-0.3%), trading at $1.15.
In French corporate news, Veolia announced an agreement to acquire Clean Earth from Enviri, calling it "its most significant and transformative acquisition since the merger with Suez, both for accelerating its growth in the United States and in the American hazardous waste sector."
After a week-long suspension, Ubisoft returned to the Paris market at 10 a.m. today to announce its half-year results. The group posted an adjusted net loss attributable to the group of -37 million euros for the first half of its 2025-26 fiscal year, compared to a loss of -208.1 million euros a year earlier. Diluted non-IFRS earnings per share came in at -EUR0.28, versus -EUR1.64 last year. After gaining more than 10%, the stock saw profit-taking and closed the session up 3.9%.
Canal+ announced last night that it has secured 100% renewal of its exclusive broadcasting rights for the UEFA Champions League, Europe's premier football competition, allowing it to continue airing matches in France until 2031, to the "great relief" of analysts covering the stock.
Kering is preparing to launch "House of Dreams," a division aimed at identifying and supporting emerging brands to reduce the group's dependence on Gucci.
Finally, ArcelorMittal announced Friday that it has reduced its capital by canceling 77.8 million treasury shares, a move that comes as the world's largest steelmaker recently completed a share buyback program covering 85 million shares.
