The Paris stock market is currently gaining nearly 1.3%, around 6710 points, buoyed in particular by the luxury goods sector with LVMH (+3.2%), Kering (+2.9%) and Hermès (+2.2%).

Investors don't seem to have decided to take a break after a rather successful start to the year, characterized by two consecutive sessions of gains and a cumulative gain of 2.3%.

Nevertheless, many believe that it is still too early to return aggressively to the equity markets, given the current lack of visibility.

This morning, investors were able to take note of several statistics. While the composite PMI index for overall activity in France rose slightly from 48.7 in November to 49.1, it remained unchanged below 50 in December, signalling a second monthly contraction in private-sector activity.

S&P Global, which calculates the index, reports that activity declined in both the services and manufacturing sectors, although the pace of contraction was again more marked among manufacturers.

In addition, the contraction of activity slowed in December in the Eurozone against a backdrop of easing inflationary pressures, according to S&P Global's latest PMI survey.

Its final composite PMI index measuring overall activity in the region's private sector thus rose to 49.3 last month, after falling to 47.8 in November.

Against this backdrop, the U.S. statistics expected at the start of the year will be decisive in determining where the U.S. economy stands at the start of 2023.

'A moderate slowdown in economic activity and employment should still satisfy the markets, as they will see this as a sign of a less restrictive monetary policy, without anticipating a recession', explain IG's teams.

A sharp slowdown, on the other hand, could allow a very short-term rebound for the same reasons, but would probably lead to a sharp downturn later on, against the backdrop of a likely future recession", says the broker.

On the interest rate front, bond yields confirmed their easing trend, with ten-year French OATs down to 2.89% and German Bunds to 2.37%.

In the United States, the yield on 10-year Treasuries stabilized at around 3.79%, after declining the previous day.

On the currency markets, the dollar fell back slightly to around 1.0585 against the euro, after starting the year on a particularly strong recovery.

On the energy front, oil prices suffered a sharp fall in the wake of falling gas prices and a slowdown in Chinese industry. Brent gave up 2.3%, to $80.5, and WTI 2.2%, to $75.6.

In corporate news, Saint-Gobain, via its subsidiary Chryso, announced that it had finalized the acquisition of Matchem and signed an exclusive agreement with a view to acquiring IDP Chemicals, two companies positioned in the buoyant building and infrastructure segments in Brazil and Egypt.

At the end of December, Neoen announced that it had finalized financing for the first 209 MW of its Goyder South Stage 1 wind farm (total capacity 412 MW) near Burra, South Australia.

Finally, CGG and TGS announce the second phase of the 3D multi-client study of Foz do Amazonas, in Brazil's equatorial margin, which covers 11,425 square kilometers and will provide additional high-quality data for exploration in this area.

Copyright (c) 2023 CercleFinance.com. All rights reserved.