On both sides of the Atlantic, full risk-on is the order of the day, including in France, two days after the adoption of the motion of censure that brought down the Barnier government on Wednesday evening.
Stock market records followed (6 in a row in Frankfurt, 3 in Wall Street on the Nasdaq and S&P500), without prejudice to the bond markets, which continued to relax, boosted by the expectation of a rate cut by the ECB and the FED within the next dozen days.

The fall of the minority Barnier government and the rejection of its ambitious austerity budget do not necessarily mean an immediate and major financial crisis," say Banque Richelieu's teams.

"We do not expect the French disorder to trigger a crisis of confidence in the euro similar to that of 2010-2012.

In fact, our OATs have eased by -1.5pts over the week (not very spectacular) and, above all, the France-Germany spread has contracted to just 76 basis points.
Bunds are stagnating at 2.1060% (industrial production is down -1% in Germany), while our OATs have eased by -1.3pts to 2.870%, i.e. a spread of around 76 basis points, compared with over 88 basis points a week earlier.

In his address broadcast last night, President Macron pledged to appoint a new Prime Minister 'in the next few days', and then to enact 'Special Laws' to counteract the deleterious effects of the lack of a PLF 2025.

On the political sidelines, there were some much-anticipated economic indicators on the agenda this Friday.

The monthly report from the US Department of Labor showed 227,000 non-farm jobs in November, according to the Labor Department, a number slightly above economists' expectations, which were generally around 200.000.

However, the unemployment rate rose by 0.1 points to 4.2%, where stability at 4.1% was expected, while the labor force participation rate stood at 62.5%, and average hourly earnings rose by 4% year-on-year.

In addition, non-farm job creation for the previous two months was revised from 223.000 to 255,000 for September and from 12,000 to 36,000 for October, for a total revision balance of +56,000 for these two months.

The preliminary calculation of the University of Michigan's consumer index shows a rise in confidence, to 74 this month, after 71.8 in November and 73.3 expected by economists.

While the sub-index measuring the evolution of their expectations worsened to 71.6, from 76.9 last month, the sub-index assessing their judgment of their current situation jumped to 77.7, from 63.9 in October.

Despite these very robust figures, T-Bonds eased by 2Pts to 4.1600%, and the '2-year' by -4.3Pts to 4.102%: the probability of a rate cut on 18/12 stands at over 70%, compared with 66% a week ago, according to the FedWatch barometer of stock market operator CME Group.



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