Cac 40 Rises Above 8300 Points
The Paris stock exchange extended its rally on Tuesday, with the Cac 40 index climbing 1.1% to 8,326.53 points by midday following a 1% gain on Monday, investir.lesechos.fr reported.
Markets advanced in the wake of a strong session in New York and a continued decline in oil prices. Brent crude dropped below the $90 threshold for the first time since August, hitting a morning low of $89.21 per barrel.
Negotiations between Iran and the United States will continue without expected military escalation in the interim, according to a source close to the matter cited by investir.lesechos.fr. New York indices were expected to remain relatively stable prior to the release of October United States inflation data.
U.S. Employment Surges Past Consensus
The United States economy added approximately 165,000 nonfarm jobs, more than double the consensus estimate of 70,000 positions. The unemployment rate edged down 0.1 points to 4.1% of the active population, according to figures released ahead of the Federal Reserve policy meeting.
Hourly wages increased 0.4% over one month and 3.1% over one year, topping forecasts of 0.3% and 2.9% respectively. Swissquote analyst Ipek Ozkardeskaya noted that central bankers aim to avoid price pressures feeding into higher wages, which in turn drive further inflation.
San Francisco Fed President Mary Daly stated that she expects the central bank to raise interest rates further while the timeline remains uncertain. Daly described the labor report as good news for workers while emphasizing ongoing inflation pressure on household finances. They see that they can find work and continue to spend,
Daly said, adding that consumers remain caught in the cycle of galloping inflation.
Consumer Prices and French Equities
Investors awaited October U.S. consumer price figures, with the Bloomberg consensus projecting a 0.3% monthly increase following September’s 0.6% jump. Annual consumer price data for October was omitted due to the government shutdown, investir.lesechos.fr reported.
Renault shares gained 2.7% after Jefferies upgraded the stock to a buy rating from hold. Banking stocks lifted the broader Paris market, with BNP Paribas, Société Générale, and Crédit Agricole rising more than 2%. Safran climbed 4% and Saint-Gobain advanced 3.4%, while TotalEnergies fell 1.5% amid lower oil prices.
Market Questions on Inflation and Rates
- Why did October annual inflation data remain unavailable in the United States? The figures were not published due to a government shutdown, according to investir.lesechos.fr.
- How did the U.S. labor market perform ahead of the inflation release? The economy created 165,000 nonfarm jobs while the unemployment rate declined to 4.1%.
- What drove the pullback in oil prices supporting European indices? Brent crude fell below $90 per barrel following diplomatic developments regarding Iran.
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