The Paris Bourse gained almost 0.6% this morning, around the 7,230-point mark, driven by Worldline (+3.9%), STMicro (+3.7%) and Eurofins Scientific (+3.6%), but penalized by Alstom, which shed almost 16%.

The Paris index thus seems to be continuing on its upward trajectory of the previous day (+1.4%), an enthusiasm triggered yesterday by inflation figures.

But some professionals argue that the slowdown in inflation is mainly due to the sharp drop in prices at the pump, and fear that this favorable sequence will only be short-lived.

JPMorgan strategists warn: "While the moderation in growth is a step in the right direction, rate hikes are still a possibility in a context where inflation is likely to remain high in the months ahead".

"There is great uncertainty as to the FOMC's ability to bring inflation back to its 2% target", add the teams at Muzinich & Co.

The persistence of these questions is likely to spoil the party in Europe, where equities boast attractive valuations compared to other regional markets and bonds.

"The risk, in our view, is that interest rates will remain high for a long period", acknowledges Oliver Collin, co-head of European equities at Invesco.

In addition to the risk associated with the direction interest rates will take, the professional points to a number of worrying factors as the year draws to a close, including the possibility of a recession or a hard landing for the economy.

On the statistics front, in France, year-on-year consumer prices rose by 4% in October 2023, following an annual rate of 4.9% in September, according to Insee, which thus confirms its provisional estimates unveiled at the end of last month.

Furthermore, according to Insee, in the third quarter of 2023, the ILO unemployment rate rose by 0.2 points to 7.4% of the working population in France (excluding Mayotte).
It returned to its level of the second quarter of 2022, but remained well below its mid-2015 peak (-3.1 points).

Finally, British inflation fell in October to its lowest level since 2021, bringing it closer to the Bank of England's target and giving consumers some breathing space.

Consumer price inflation (CPI) fell back to 4.6% last month, slightly better than the consensus forecast (+4.7%), after having risen to 6.7% in September.

In the United States, retail sales figures will be released in the early afternoon, providing an indication of consumer spending in the run-up to the festive season.

Up to now, strong growth in the US economy has been fuelled by household consumption, a vigour that stands out against the current backdrop of tightening credit and slowing employment.

In French company news, Alstom is down nearly 16% after announcing this morning that it is working on a global operational, commercial and cost efficiency plan, including a reduction of around 1,500 FTE (full-time equivalent), or nearly 10% of sales and administrative functions.

In a strategy presentation devoted to Ampere, Renault sets out its objectives for this electric vehicle and software company, which it plans to float on the stock market in the first half of 2024, while retaining a strong majority stake.

Finally, Oddo BHF maintains its 'underperform' rating on Orpea shares, with a price target reduced from 0.5 to 0.025 euros, following the Commercial Court's validation of CDC's capital increase. The broker indicates that it intends to remain 'on the sidelines'.

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