The Paris Bourse has turned the tide since midday: down slightly this morning and unable, as on the previous day, to initiate a rebound that would hold up, the CAC40 is finally recovering, after five consecutive sessions of decline.

At the end of the session, the CAC40 index recovered 0.6% to 7,116 in skeletal volumes (2,850MnsE).

Wall Street had reopened lower, but the buyers prevailed with +0.4% on the S&P500 and +0.5% on the Nasdaq (despite Micron with -3%).

Fear of the effects of interest rates 'maintained at high levels for an extended period' has recently dampened investors' appetite for risky assets (equities) due to their implication on growth (the US '10-year' is now anchored above 4.65% and has tested 4.688%).

Signals remain negative for the time being, with the possibility of breaking the symbolic 7,000-point level", warn Kiplink Finance's technical analysts.

The first estimate of German inflation for September came in at +0.3% (same score in August), for a 12-month rise of 4.5% (vs. 4.6% expected): no cause for euphoria for Bunds, which saw their yields explode by +13Pts to a new annual record of 2.962% (and 2.98% at their highest).

Our OATs are also pulverizing their peaks, with +13Pts to 3.53%, and Italian BTPs are exploding with +15Pts to 4.928% (4.96% at the zenith).

The day's US figures are not lightening the mood for bonds: unsurprisingly, Q2 GDP is revised downwards once again, from +2.2% to 2.1% (final).

The good news is that core inflation is down to 1.7% from 2.2%... the bad news is that, with WTI at $95 a barrel on Wednesday evening, this decline is not going to last.

The other bad news is that the job market - closely watched by the FED, which wants to see unemployment rise - remains very resilient: the Labor Department reveals that jobless claims rose by just 2.000 to 204,000 at the end of the week of September 23 (economists were expecting an average of 215,000 jobless registrations).

Third piece of bad news: the four-week moving average, considered a more reliable indicator of the underlying trend in the labor market, fell by -6,250 to 211,000.

Market attention will turn to inflation tomorrow, with the publication of a first estimate of the Eurozone consumer price index for September.

Investors will then take note of the PCE index, a crucial measure of inflation in the United States, at a time when the price of a barrel of Brent crude is getting dangerously close to the $100 mark (propelling TotalEnergie to an all-time record above 64.5E).

On the oil market, Brent is now consolidating -1% towards 95.5 after peaking this morning at over $97.6, a new high since autumn 2022 (1% off the peaks of October 10 and November 8 2022), while WTI is up 1.5% at $95, before falling back towards $93 (-0.8%).

Fears over rates have so far relegated the threat of a US government shutdown this weekend to second place.

Strategists warn that such a scenario could, however, have a severe economic impact, as the US is currently facing several headwinds (resumption of student loan repayments, auto strikes, rising gasoline prices).

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