The Paris Bourse is expected to open slightly lower on Friday, amid a wait-and-see attitude ahead of the long Christmas weekend and the publication of crucial US inflation indicators.

At around 8:15 a.m., the future contract on the CAC 40 index - maturing in January - was down 6.5 points at 7,582.5, heralding a note of weakness in early trading.

The trend remains hesitant as investors continue to question the monetary policies of the major central banks, while having to digest often mixed economic indicators.

PCE inflation - the indicator on which the Federal Reserve relies to monitor the trajectory of prices - is due at 2.30pm and is expected to decline compared with the previous month.

The consensus is for a decline to 3.4% in the 'core' version, i.e. excluding food and energy, in November, compared with +3.5% in October, expectations bolstered by the reassuring price data published last week.

'If this is the case, it would reinforce the Fed's pivot towards monetary easing', emphasize analysts at Oddo BHF.

Despite the accommodating tone adopted by the central authority last week, investors are beginning to fear that the Fed will decide to slow its rate cuts next year in the face of persistent inflation and solid economic data.

Today's session will also be marked by the release of US durable goods orders, new home sales and Michigan consumer confidence figures.

With all Euronext markets remaining closed on Monday and Tuesday, investors could also start fine-tuning their strategy for 2024 as the New Year approaches.

While the CAC 40 has been flirting for several days with the historic and hard-to-cross 7,600-point mark, which it broke through last week, it will take a real catalyst to get investors moving.

'With only a few sessions to go before the annual close, the CAC 40 index remains torn between holding on to its established performance and the risk of losing last week's all-time record too quickly', explain Kiplink's chartists.

At this stage of the year, the Paris Bourse's flagship index has posted a 17% gain since the start of the year, one of its best annual performances in the last ten years.

'There doesn't seem to be much left to gain in the very short term, in which case we can hope that the CAC 40 index will secure an annual close above 7,600 points as soon as possible', the analysts point out.

Bond yields continued to fall, with the US ten-year falling back below 3.90%, while its German equivalent lost further ground to 1.96%.

The euro climbed against the dollar to test new highs since the summer at around 1.10, with investors betting that the US Fed will beat the ECB with its first rate cuts.

The oil market remains underpinned by geopolitical factors, in this case tensions in the Red Sea, which more than offset the prospect of a slowdown in global economic activity.

Brent crude climbs 0.9% to $80.1 a barrel, and US light crude (West Texas Intermediate, WTI) recovers almost 1% to around $74.6.

Copyright (c) 2023 CercleFinance.com. All rights reserved.