The Paris Bourse (+0.45% to 7,560) resumes its inexorable advance 4 days ahead of the '4 Witches' session, with a new all-time record for the CAC40 'GR' (at 22,867Pts).
For the CAC 'PX1', with trading having just exceeded 1,250 billion euros at 5pm, a record close is on the cards for the next few hours (just 0.2% short of 7.573).
And annual or all-time records continue to fall for the DAX (at 16,790) and the Euro-Stoxx50 (+0.4%, around 4,540 points).
Investors are showing unshakeable confidence in the continuation of the 'end-of-year rally', despite meetings of the US Federal Reserve (on 12/13) and the European Central Bank (ECB on 12/14).

The major central banks recently ended their rate hike cycle, but their more accommodative approach does not seem sufficient in the eyes of the markets, which are now anticipating rapid rate cuts, convinced that Mr J.Powell or Ch.Lagarde are the unfailing allies of holders of "risky" assets.

Friday's publication of better-than-expected employment figures for November confirmed the scenario of a 'soft landing' for the US economy, making monetary easing less urgent... but that's already forgotten.

Wall Street has been applauding the emergence of a 'Goldilocks' scenario for 6 weeks now, and records are also falling for the Dow Jones (36,335) and the S&P500 is surpassing its July 17 high of 4,607Pts to set a new one at 4.609: a closing record looks likely if the mid-session highs hold until 10pm.

In Europe, indices have matched or beaten the S&P500 since January 1st: an imminent rate cut is expected as the European Central Bank (ECB) is urged to do more in the face of an economy that is undeniably flirting with recession.

Markets believe that the first rate cuts could take place as early as March, and that the ECB could make as many as six 0.25% rate cuts in 2024", notes Alexandre Baradez, Head of Market Analysis at IG France.

For the strategist, these expectations are probably too aggressive, given that underlying inflation in the eurozone is currently hovering around 3.6%, still far from the 2% target set by the central bank.

Nor does the Bank of England, whose announcements are expected on Thursday as is the case for the ECB, seem in any great hurry to join the 'dove' camp.

With central banks seemingly unwilling to go along with current market forecasts, the return to reality could prove complicated for investors already in euphoric mode.

In addition to the central bank announcements, the autumn rally will be put to the test by a number of key economic indicators, including the latest inflation and retail sales figures in the USA.

In Europe, the preliminary PMI indices for December - due on Friday - will be used to assess the seriousness of the recessionary threat on the Old Continent.
In the meantime, it's all quiet on the bond front, with Bunds and OATs stuck at Friday's levels (2.268% and 2.82%), while T-Bonds are up +2.3Pt at 4.270%.

In news from French companies, Alstom announced over the weekend the inauguration of Citadis Dualis tram-trains on line T12 of the Île-de-France Mobilités network, which since yesterday has linked two major Essonne hubs, Évry-Courcouronnes and Massy-Palaiseau.

Arkema announces that it has signed a 20-year contract with EDF Renouvelables for the supply of 20 GWh/year of solar-generated electricity, a partnership that will begin in 2026 and cover 70% of the electricity consumption of Bostik's eight sites in France.

Saint-Gobain announces that it has signed a four-billion-euro line of credit maturing in December 2028, including two one-year extension options, which replaces two available lines of 2.5 and 1.5 billion maturing in December 2024.


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