The Paris Bourse ended the session down 0.84% at 7,625 points, with Michelin's strong rise (+6.9%) unable to offset the sharp declines of URW (-4.1%), STMicro (-3.5%), Teleperformance (-3%) and Alstom (-2.6%).

The Paris index widened its losses from 2.30pm onwards with the release of US inflation figures: consumer prices rose by 0.3% (vs. +0.2% estimated) in January, or 3.1% on an annualized basis (vs. 3.4% the previous month).

Core underlying inflation (excluding food and energy) came in at +0.4% last month (above the median forecast of +0.3%), leaving the annual core inflation rate unchanged at 3.9%.

Investors were hoping that the consumer price index would come in just below the psychological threshold of 3% year-on-year.

For some weeks now, inflation has been less of a concern for investors, who are more focused on the strength of activity and good corporate results.

But the strength of more persistent inflation than anticipated is leading investors to push back the horizon for the Federal Reserve's first rate cut (now less than 50% for May).

"The market will have to wait to see the 'pivot'. It certainly won't be in March, and it's looking less and less likely in May", stresses Christopher Dembik, Investment Strategy Consultant at Pictet Asset Management.

Against this backdrop, the yield on T-Bonds has jumped by +11pts to 4.2820% (+45pts since February 1), while the Bund with the same maturity is trading at around 2.39% (+1pt).

This rise in yields is propelling the dollar against the euro, towards $1.0715.

Gold is naturally suffering from the greenback's firmness, dropping -1.5% to $1993 an ounce.

Conversely, Brent crude oil is gaining 0.8% to $82.7 a barrel in London.

Published earlier this morning, Germany's ZEW business climate index rebounded sharply, gaining a further 4.7 points in February to stand at +19.9: in reality, this refers to the "outlook" (2/3 of business leaders are betting everything on the ECB rate cut this summer), since the ZEW continues to deteriorate for the "present situation": -4.4 points to -81.7, the lowest since June 2020.

In France, the unemployment rate in France (excluding Mayotte) as defined by the ILO (International Labor Office) came out at 7.5% of the working population in the last quarter of 2023, stable compared with the third quarter, whose estimate was raised by 0.1 points to 7.5%.

In news from French companies, Fnac Darty announced that the Supreme Court in London has definitively closed the litigation linked to the sale of Comet Group Limited in 2012.

Wendel denied on Tuesday that it had acquired a stake in the insurance brokerage group Diot-Siaci, saying it had not concluded any transaction involving the company's capital.

Airwell Group announces that it has taken a 13% stake in Synerpod, a French start-up that aims to massify energy renovation in collective and individual housing.

Air Liquide announces that it has signed a long-term virtual power purchase agreement with Statkraft, Europe's largest renewable energy producer.

Lastly, Believe's share price has risen by almost 20% to close in on the price proposed by a consortium with a view to taking control of the group.


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