The Paris stock exchange extended its gains after a cautious start this morning: the CAC40 rose by 0.6%, approaching 8,075/8,080, and appears well on its way to closing the 8,119 "gap" from November 17.
The benchmark index is benefiting from strong performances by L'Oréal (+2.3%), Société Générale (+2.1%), STMicroelectronics (+1.6%), and AXA (+1.4%).
The trend is also "vigorous" across Europe, with the E-Stoxx50 up 1.1% (5,635), while US indices are posting a fourth consecutive gain, buoyed by increasingly clear expectations of a Federal Reserve rate cut in the United States on December 10. These same expectations propelled the S&P500 to 6,900 on November 12.
Wall Street has rebounded by 4% over four sessions. The Nasdaq-100 confirms a break back above 25,000, rising 0.4% to 25,130. The S&P500 shows a similar increase, reaching 6,800, and may close the 6,830 "gap" from November 13 before 10 p.m. tonight, having climbed above its 50-day moving average of 6,750.
The Dow Jones is also up 0.4%, heading toward 47,300, not far from the 47,411 "gap" of 11/13.
Indeed, the latest US statistics--durable goods orders rose by 0.5% as expected--have reinforced the likelihood of another Federal Reserve rate cut on December 10, an outcome now considered credible by nearly 83% of traders, according to the CME's FedWatch tool.
With risk appetite returning, stress is easing and the 'VIX' volatility index--often referred to as the fear barometer--has dropped below the 20-point threshold, falling another 3.7% to around 18.70.
"Once again this year, sellers find themselves on the wrong side of the markets," notes Michael Brown, strategist at Pepperstone.
"The US economy remains solid, earnings growth is robust, the business climate is calming, and monetary policy remains accommodative: a set of factors clearly pushing risk assets higher," the analyst adds.
"Add to this a very favorable seasonal pattern and flows driven by the fear of missing out (FOMO) on the so-called 'Christmas rally,' which supports the resumption of share buybacks, and you have an environment that would be difficult--even unwise--to bet against for now," he concludes.
Purchases are all the more strategic this Wednesday as Wall Street prepares for a four-day break for Thanksgiving (there will be a half-session this Friday, November 28, which also marks the end of the calendar month).
On the bond market, the yield on 10-year French OATs remains stable at 3.41%, with the German Bund at the same maturity at 2.683% (+1bp), and Italian BTPs holding at 3.405%.
Across the Atlantic, the "risk-on" mood is putting some pressure on T-Bonds, with the 10-year yield rising by 2.5bps to 4.024%, and the 30-year by 1.5bps to 4.672%.
Brent crude is down 1.2% at $61.75 ahead of the release of US oil inventory data, expected at 4:30 p.m.
On the Forex market, the euro is up 0.2% against the greenback, trading around $1.1580.
In French corporate news, Dassault Systèmes announced it has deepened its partnership with Mistral AI. The enterprise software developer will now offer 'sovereign' AI services tailored to regulated sectors and public administrations in Europe.
Solutions30 announced the expansion of its strategic partnership with Spirii, a provider of platform solutions for electric vehicle charging, to accelerate the deployment and maintenance of charging stations across Europe.
Finally, Compagnie des Alpes announced that the offer submitted by its subsidiary, Société d'Aménagement de La Plagne (SAP), has been selected by the Syndicat Intercommunal de la Grande Plagne (SIGP) following a competitive process.
As a result, it has been awarded the renewal of the Public Service Delegation (DSP) contract for the development and operation of the La Plagne ski area (lifts and slopes), as well as the management of intra-resort shuttles and the bobsleigh track.
