The Paris Bourse is set to open sharply higher on Thursday morning, in a climate of euphoria following reassuring announcements from the Fed and pending decisions from the European Central Bank (ECB).

At around 8:15 a.m., the 'future' contract on the CAC 40 index - December delivery - climbed 82.5 points to 7,617.5, heralding an opening well above the 7,600-point threshold, a level never before reached.

As widely anticipated by the markets, the US Federal Reserve decided on Wednesday evening to keep rates unchanged, while opening the door to a "pivot" in favor of monetary easing as early as next year.

Its rate forecasts, nicknamed "dot plots", have been modified to include the assumption of three rate cuts in 2024.

"We see this as a strong signal that the Fed is starting to prepare the markets for rate cuts, depending on the economic data received", commented Danske Bank analysts.

This prospect is particularly clear from the CME's FedWatch barometer: investors now estimate the probability of a 25 basis point rate cut in March at over 73%, compared with less than 40% yesterday.

"The question is (...) no longer whether monetary policy will be eased, but when and how quickly", say the teams at Oddo BHF.

By favouring the scenario of a "soft landing" for the US economy, Central Bank Chairman Jerome Powell precipitated a run on the stock markets, which were already trading at record levels.

At the final bell, the Dow Jones and Nasdaq each gained 1.4% to set new all-time highs.

Speculation is now turning to the possibility of the Fed stepping up its rate cuts next year, which should provide the equity markets with additional fuel.

Jerome Powell's dove-like comments caused a spectacular reaction in the bond compartment, sending the yield on 10-year Treasuries plunging towards 4%, the first time this has happened since July.

Next up is the ECB, which is also expected to opt for a 'status quo' on rates at the end of its Governing Council meeting, scheduled for this morning.

Here again, investors will be looking for clues as to the policy the Frankfurt-based institute intends to adopt next year, given that markets are currently banking on six rate cuts in 2024.

It's still too early to talk about rate cuts, and the ECB will want to be cautious in its rhetoric, so as not to raise investors' expectations too much", warns Emmanuel Auboyneau, Associate Manager at Amplegest.

"Inflation is not yet vanquished and still requires vigilance", adds the professional. Christine Lagarde will have no choice but to remain very measured in her speech", he concludes.

Following the Fed's conciliatory announcements, and in anticipation of a more neutral tone from the ECB, the euro is rallying against the dollar to trade in the 1.09 zone.

The day will also be marked by the monetary policy decisions of the Bank of England, which has less latitude than its counterparts in view of the country's still very high level of inflation.

In terms of US indicators, investors will be paying close attention to the publication of import prices, jobless claims and, above all, the latest retail sales figures.

A price effect, due in particular to the fall in gasoline prices, pushed sales down in October, a trend which is likely to continue in November, especially as the slowdown in the credit and employment markets is likely to penalize household consumption.

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