Cac 40 remains in retreat, weighed down by TotalEnergies and indifferent to US jobless claims

Posted on December 28, 2023 at 3:01 pmUpdated December 28, 2023 at 4:55 p.m

US jobless claims data fell. But their rise, albeit slightly above expectations, to 218,000 for the week ended December 23, did not affect the trend on the Paris stock exchange. It must be said that these statistics can be more volatile during the end-of-year holidays. The moving average over the past four weeks, which gives a clearer picture of the trend, was little changed at 212,000, the lowest since late October.

The Cac 40 lost 0.43% to 7,539.28 points around 15:40, heavily down TotalEnergies and in a more general consolidation move, which is not surprising given its performance in recent weeks, which has taken the index to new all-time highs. Trade volumes are anemic, around 520 million euros. In New York, the three main indexes rose from 0.13% to 0.23%. The S&P 500 at 4,790 points is just fractions from its closing peak of 4,796.56 points and its all-time high of 4,818.62.

Investors are looking forward to 2024 and hoping that the performance will match the performance seen this year. The Cac 40 has gained over 16% so far in 2023 compared to a poor performance in 2022 (-9.5%). A sharp fall in inflation in the United States and Europe, which led to a change in tone by central banks, led markets to expect significantly lower borrowing costs in 2024, following a cycle of rate hikes in the past two years. Analysts at Goldman Sachs believe the US central bank, facing a rapid decline in inflation, may need to act soon and quickly. “ We expect interest rate cuts of 25 basis points in March, May and June, followed by one cut per quarter until the target federal funds rate reaches 3.25% to 3.5% in the third quarter of 2025. », They write in a note.

Nothing is won for 2024

However, some experts fear too much optimism. The Fed’s December projections for a 75 basis point rate cut in 2024 are based on the belief that the US economy will experience a soft landing with inflation gradually returning to the 2% target, growth slowing slightly and unemployment still relatively low. ” It is not possible to develop an economic scenario more perfect than the committee’s forecasts (…) If that happens, that would be great. But there are only risks », commented Stephen Stanley at Santander. ” If the progress we’re seeing on inflation stalls and the path to 2% inflation no longer looks so clear, then the Fed’s tone will have to change (…) I’m a little skeptical. I do not think we will continue the rapid improvement in inflation that we have seen over the past few months », added the chief economist.

On the trading side, TotalEnergies suffered one of the biggest declines on the Cac 40, losing 1.3%, after the American Petroleum Institute announced an increase in US crude inventories last week, while a draw was expected. A development that supports the idea of ​​an imbalance between producer supply and consumer demand.

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