Schneider Electric at all-time high at stable Cac 40

Posted on December 19, 2023 at 5:40 pmUpdated December 19, 2023 at 5:54 p.m

Investors seem to have hit the pause button a few days before the Christmas break. On the Paris Stock Exchange today, the Cac 40 closed at a stable level (+0.08% to 7,574.67 points), with a weak trading volume of 2.76 billion euros. Schneider Electric reached a new all-time high of 181.94 euros before ending slightly lower (-0.32%). UBS raised its price target for the electrical equipment maker from 175 to 207 euros. The Swiss bank, on the other hand, lowered its recommendation for Legrand (-1.75%), which now recommends “sell”.

Outside the Cac 40, we note a bounce of almost 7% in Worldline, while Bryan Garnier switched from “sell” to “neutral”. Virbac gained more than 12%, the veterinary laboratory raised its targets for 2023 thanks to the continued recovery of its sales in the fourth quarter. Red Lantern SRD, Casino down 10% as trading resumes. Announced by the distributor “exclusive deal” with Auchan and Groupement Les Mousquetaires for the purchase of almost the entire (313) range of its hypermarkets and supermarkets.

No surprises on final Eurozone inflation figures

The final Eurozone inflation data, consistent with the figures from the first estimate, logically left the market calm. The rate of inflation, measured by consumer prices in the 20 countries that make up the eurozone, rose to 2.4% year-on-year in November and to 3.6% after the components of energy, food, alcohol and tobacco. In the previous month, it was 2.9% and 4.2%.

The confirmation of calm should be seen as good news for the European Central Bank, but the European Central Bank signaled through its president Christine Lagarde that there was no rate cut debate last week, underscoring lingering pressures on wages. However, the central scenario for the market remains ECB easing next year, as with US central bank rates.

“Although domestic price pressures are easing, it will be several months before policymakers have enough evidence that they have eased enough to justify cutting interest rates. Monetary easing in the first quarter is possible, but we think the ECB is likely to wait until April »argued Jack Allen-Reynolds, deputy chief economist for the eurozone at Capital Economics.

Friday, big meeting

Turning to U.S. statistics for the day, housing starts rose 14.8% last month to 1.56 million at an annual pace, but building permits fell slightly to 1.46 million units. The biggest macroeconomic meeting scheduled before the holidays will take place on Friday with the PCE price index in the United States. Unlike the Fed’s projection of three rate cuts next year, the market expects almost twice as many, with the first easing in March. A more rapid easing of inflation towards the 2% target will be needed to confirm these particularly optimistic forecasts, the IG points out. The Bloomberg consensus sees the core index slowing from 3.5% to 3.3%, the slowest since May 2021.

On Wall Street, the main US indexes rose 0.5%.

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