CAC40: attempts to rebound before Nvidia results

(CercleFinance.com) - The Paris stock market gained nearly 1% this morning, around 8130 points, driven by Schneider Electric (+3.
2%) and the luxury goods sector with +3.1% for Kering and +2.7% for LVMH.

On the other hand, Stellantis' results (see below) were punished, with the stock losing almost 3.8%.

After a 0.5% decline the previous day, the Paris market is attempting to bounce back, just a few hours before the publication of Nvidia's eagerly awaited results in the United States.

For the past ten days, the European and American equity markets have been struggling to find a clear direction, torn between hopes of a peace agreement in Ukraine and growing uncertainties about the global economy.

A sign of traders' questioning, the S&P 500 index last night posted its fourth consecutive session of declines, a series unseen since the start of the year.

As for the Nasdaq Composite, it has just suffered losses in excess of 1% over the last three sessions, an event not seen since last August.

Against this cautious backdrop, the CBOE Volatility Index, also known as the "fear barometer", yesterday lurched above the 20-point threshold, considered an uncomfortable level, before calming down a little towards the end of the session.

Investors' nerves will be sorely tested this evening by the quarterly results of Nvidia, the last of the 'Magnificent Seven' to publish its accounts.

Enthusiasm for AI-related stocks has waned of late, due to the unexpected emergence of the low-cost Chinese application DeepSeek and rumours of a downward revision of Microsoft's investments in the field.

In fact, it's the chipmaker's outlook that will be most closely watched, with analysts keen to know whether the Californian group can maintain its gross margin of over 75%, at a time when competition in the sector is clearly intensifying.

Given that Nvidia alone accounts for 8% of the Nasdaq 100 index and over 6% of the S&P 500, its performance should have a major impact on the stock market over the next few days.

According to the professionals, the options market is forecasting 8.5% volatility in its share price on both the upside and the downside, which means that the market's reaction is bound to be spectacular.

Beyond the results, investors will continue to monitor the economic situation in Europe and the United States, even if there are few statistics on today's agenda.

On the indicators agenda, however, are the figures for new home sales and weekly oil inventories in the USA.

On the currency markets, the euro is trying to cling to the 1.05 threshold against the dollar in the wake of the disappointing statistics of recent days, which have reinforced the prospect of Fed action.

According to the FedWatch barometer, a majority of traders (53.7%) now expect a further rate cut in June, compared with 48.8% previously.

The bond market rallied accordingly, with yields on 10-year Treasuries now below 4.30%, the lowest in over two months.

The trend of risk aversion is much less evident in Europe, where the yield on 10-year German Bunds is easing more modestly, to 2.45%, while the OAT for the same maturity stands at 3.20%.

With rates easing, gold is stabilizing at around $2,919 an ounce, following the new highs set on Monday.

Oil prices are back on a slight upward trend a few hours ahead of the release of US inventories. North Sea Brent is up 0.2% at 73.2 dollars a barrel.

Stellantis announced this morning that it generated net sales of 156.9 billion euros last year, down 17% on 2023, with net profit down 70% to 5.5 billion euros for the year.

Worldline reports net income, Group share (RNPG), on a normalized basis, down 16.8% to 434 million euros for 2024, or 1.53 euros per share, as well as free cash flow down 43.4% to 201 million.

Danone reports recurring EPS for 2024 up 2.5% to 3.63 euros, with recurring operating margin up 39 basis points to 13%, "while continually reinvesting in future growth".

Lastly, Interparfums has announced a 10% increase in net income, group share (RNPG) to 129.9 million euros for 2024, as well as a virtually stable current operating margin (+0.1 points) to 20.2% on sales up 10% to 880.5 million.


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