The Paris stock exchange closed the first session of December down 0.32% at 8,097 points, weighed down by Airbus, which plunged 5.8% after around 6,000 A320 aircraft were found to be affected by a software issue.
A recent incident involving an aircraft that experienced a control anomaly mid-flight revealed that solar radiation could impact the flight controls of a significant number of A320 family aircraft currently in service.
"We are working with our airline customers to support the modification of fewer than 100 remaining aircraft to ensure their return to service," the manufacturer stated this morning.
The planemaker is also dealing with industrial quality issues concerning fuselage panels on several dozen A320 family aircraft.
The Paris index also suffered from declines in Bureau Veritas (-2.9% after a broker downgrade), as well as defense stocks such as Thales and Safran (down 2.6% and 1.4% respectively), while Rheinmetall dropped sharply in Frankfurt (-2.4%).
Across the Atlantic, red numbers dominated: the S&P 500 fell 0.3%, ahead of the Nasdaq (-0.5%).
Despite this, "Black Friday" sales were a success, with record-breaking online spending during the November 29 and 30 promotions.
However, the mood is gloomy due to long-term interest rate tensions, starting this morning in Japan, where the 10-year yield soared 4.2% to a record 1.878% (+7.6 basis points), the 20-year added 6 points to 2.893%, and the 30-year rose 5 points to 3.3900%.
US T-Bonds tightened by 6.5 points to 4.0960%, and the 30-year by 7.3 points to 4.746% (despite an 87% consensus for a third US rate cut in nine days), leading to a clear deterioration in Bunds (+6 points to 2.751%), French OATs (+7.1 points to 3.485%), and Italian BTPs (+6.3 points to 3.4700%).
The optimism sparked by hopes of another Fed rate cut in December may have been overplayed last week. Doubts are emerging regarding the "progress" of the peace plan pushed by Washington but rejected by Europeans, contested by Kyiv, and not commented on by the Kremlin.
The encouraging element from last week on Wall Street lies in the broad sector participation: the bullish rally seems much less dependent on the AI theme, as illustrated by Nvidia's recent weakness, which did not prevent the S&P 500 and Dow Jones from rebounding thanks to a renewed interest in healthcare stocks, which had underperformed since the start of the year.
While valuations have become more attractive and market sentiment remains solid, the prospect of another US rate cut next week is clearly the main driver of the bullish trend.
For markets to remain upbeat, the Fed will need to lower rates and inflation will need to be better controlled without a notable deterioration in the economy, warns Scott Chronert, Citi's star strategist. "In short, the soft landing scenario must remain intact," he emphasizes.
Furthermore, a "Santa Claus rally" cannot be ruled out: December is traditionally favorable for the S&P 500, which gains on average-- and in 74% of cases-- between 1.4% and 1.5% during the period, according to Stock Trader's Almanac data.
But beyond this possible seasonal effect, participants who feel they missed out on bargains during the recent market weakness may be tempted to jump in for opportunistic buying.
On the data front, the day proved disappointing in Europe: the HCOB PMI for French manufacturing, produced by S&P Global, fell from 48.8 in October to 47.8 in November, signaling a slight acceleration in the contraction of the manufacturing sector in the eurozone's second-largest economy.
In Europe, the HCOB PMI for eurozone manufacturing slipped from 50 in October to 49.6 in November, signaling a return to unfavorable conditions for the sector, falling below the key 50 threshold.
The index's decline is mainly due to a drop in new orders, indicating renewed headwinds for demand. However, production growth continued for the ninth consecutive month.
Across the Atlantic, US manufacturing sector growth slowed slightly in November, according to S&P Global, whose sector PMI came in at 52.2, down from 52.5 the previous month.
By contrast, the ISM manufacturing index reported that US manufacturing activity contracted for the ninth consecutive month in November. The ISM index stood at 48.2 in November, down from 48.7 in October, while consensus expected 48.6.
In London, Brent crude reversed course and lost 0.2% to $63, with WTI also down 0.2% at $59.2. The euro strengthened significantly against the dollar, up 0.25% to $1.1625.
Gold advanced 0.4% to $4,240 an ounce, while Bitcoin fell 7.2% to $84,700 for no apparent reason.
In French corporate news, Bureau Veritas was among the biggest CAC 40 losers on Monday morning after RBC analysts downgraded their recommendation to "underperform" from "sector perform," with a price target lowered from EUR28.5 to EUR26.5.
TotalEnergies announced that its subsidiary TotalEnergies EP Nigeria has signed an agreement to sell a 40% stake in exploration licenses PPL 2000 and PPL 2001, offshore Nigeria, to Star Deep Water Petroleum Limited, a Chevron subsidiary.
AXA announced Friday evening that it had finalized the acquisition of a 51% majority stake in Prima, a direct insurance specialist in Italy, a deal announced on August 1 for EUR500 million (0.5 billion euros).
LVMH reported Friday evening that 1,899,397 shares had been acquired under the mandate granted on February 17 to an investment services provider (ISP), with the shares to be canceled as previously announced.
