CAC40: an all-time record is possible if the S&P beats its own.

(CercleFinance.com) - The Paris Bourse gains 0.
5% with 90 minutes to go, the CAC40 index hovers around 8,205/8,210 points... and the challenge of this session remains the setting of a new all-time closing record at 8,220.
For this, Wall Street would have to mobilize: the S&P500 grabs +0.2% at 6,128 (all-time record equaled) and the Nasdaq takes +0.3% at 20,000Pts 'all round'.
The CAC40 remains supported by Teleperformance and URW (+3%) and Kering (+2.7%): this morning, it was Hermès with its +6% to 2,950E that propelled the CAC40 to 8,210Pts.
European stock markets are catching their breath after an impressive series of record highs since January 16: the Euro-Stoxx50 set a new all-time high at 5,520, taking its annual gain to +12.6%.

Investors remain hopeful that the Ukrainian conflict will soon be resolved, as Donald Trump reported on Thursday on his social network Truth that he was holding "super talks" with Russia and Ukraine.

These hopes more than offset the US President's announcement of "reciprocal" tariffs on steel and aluminum, as he had promised at the beginning of the week.

In fact, these measures will not come into force until April, offering a kind of relief to the markets by paving the way for potential negotiations between now and then.

'Once again, it seems that Trump is barking more than he's biting when it comes to trade - since his reciprocal tariffs won't be implemented for some time - with the President even acknowledging that "many" of the US tariffs were likely to remain unchanged', notes Michael Brown, strategist at Pepperstone.

While trade risks are still very much with us, the quarterly results season, which is in full swing, also confirms the relatively good health of companies, which is providing support for stock markets.

On the macroeconomic front, at 2.30pm, investors were treated to US retail sales figures for January and the rise in import prices.
Inflation accelerated again in January on the back of rising gasoline and gas prices, according to official figures published on Friday.

They rose by 0.3% month-on-month in January (the biggest increase since April 2024), compared with +0.2% in December, +0.1% in November and +0.1% in October, according to data released by the Labor Department.
Export prices rose by 1.3% in January, following a 0.5% increase in December, taking their year-on-year gain to 2.7%, a peak since late 2022.

Logically enough, the rebound in inflation weighed on January retail sales: they contracted by -0.9% after rising by 0.7% sequentially in December (a figure revised from +0.4% in the initial announcement, as buyers accelerated their orders ahead of Trump's introduction of new tariffs in January).

The Commerce Department reports that, excluding the sometimes volatile automotive sector (vehicles and equipment), US retail sales fell by 0.4% last month, whereas economists were expecting a roughly symmetrical rise on average.

All asset classes are bathed in a climate of euphoria, and bonds are not suffering from the wave of risk appetite, as illustrated by the easing in yields.

On the US fixed-income market, the yield on 10-year Treasuries fell by 5.5 basis points to 4.47%.

In Europe, on the other hand, yields stagnated at 3.115% on our OATs, while Bundsse yields edged up by +0.5 basis points to 2.426%.

The Franco-German spread contracted to less than 70 basis points (+69), the first time this has happened since June 2024.

Buoyed by hopes of a peace agreement in Ukraine, which would have a positive effect on energy prices and the economy, the euro rallied towards $1.048 (+0.2%).

Crude oil prices also rebounded, with the encouraging outlook for the economy outweighing trade fears. Brent crude is up 0.2% to $75.4.

In French company news, Hermès International has announced a 7% increase in net income (group share) to €4.6 billion for 2024, and a 9% increase in operating income before non-recurring items to €6.2 billion, giving a margin of 40.5% compared with 42.1% in 2023.

Safran raises its outlook for 2025, still targeting sales growth of around 10%, but now current operating income of 4.8 to 4.9 billion euros and free cash flow of three to 3.2 billion.

Eutelsat reports a net loss attributable to the Group of 873.2 million euros for the first half of 2024-25, up from 191.3 million euros a year earlier, mainly due to an impairment of goodwill on GEO assets.

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