The Paris stock market is posting almost +1% at 6,928 and is becoming almost euphoric (it's beginning to look like 'FOMO'), while the euro is breaking through the 1.0730 resistance barrier against the dollar, which would be a strong indication of a wave of financial flows moving from Wall Street to Europe.

The CAC40 is on course for a 6th session of gains, which now exceed +7% (i.e. +1.3% on average per day since January 2).
This is by far the best start to a trading year in the 21st century and in the last 40 years, surpassing the +6% of early 2009.
Above all, the CAC is more than 2% above its pre-surprise invasion of Ukraine level, and around 1% above its January 9, 2022 levels on the CAC40 'GR'.
The Euro-Stoxx50 posted a thundering +1.5% gain to 4,080pts, following in the footsteps of Frankfurt (+1.6%) and Amsterdam (+1.7%).

And at 6,925, the CAC40 reached in 1 week the target set for the end of a year 2023 "fraught with danger", based on the observation that potential was low after already recovering +20% since the end of September.
And the more scepticism there is about the foundations of such a rise, the higher it goes!
Wall Street is not to be outdone, with +1.7% on the S&P500 and +2% on the Nasdaq after +2.5% on Friday.

Investors want to believe that the first month of the year generally sets the general trend on equity markets: given the current rally, this could be a historic year!

According to calculations by S&P Dow Jones Indices, when the S&P 500 index rises in January, it rises for the year as a whole more than 71% of the time.

The theorem was largely confirmed last year, when the S&P fell by 5% in the first month of the year before ending the 2022 financial year down by just over 19%.

Similarly, analysts point out that it is extremely rare for a year of stock market correction to be followed by another year in the red, leading strategists to predict a rather favorable 2023 stock market year.

For Danske Bank's analysts, the year looks 'interesting' in view of the contradictory forces currently tugging at the financial markets.

'The easing of inflation, the slight improvement in visibility, the reopening of the Chinese economy and unused liquidity are all likely to reduce the risk premium and support equities', they assure us in their latest weekly update.

On the other hand, the prospect of a recession, the continuing restrictive policies of central banks and the pressure on corporate profits still militate in favor of a cautious stance", the Danish bank moderates.

US asset manager Raymond James also predicts a rise in stock markets in 2023, but warns that the road ahead will be "full of pitfalls".

"Volatility will undoubtedly persist, and bottoming before markets recover is likely to take time in the current environment", warns Mike Gibbs, head of its equity portfolio and technical strategy.

With this in mind, we recommend that investors be patient and pragmatic, i.e. use bouts of weakness to build strength (from a long-term perspective) and not chase any rallies that may come their way," he adds.

A certain feverishness could emerge over the next few days, leading up to the week's big event on the American side, namely the monthly consumer price index (CPI) statistics published this Thursday.

Investors are hoping for a further slowdown in inflation in the USA, which reached 7.1% in November, its lowest level in almost a year.

In Germany, industrial production rebounded slightly by 0.2% month-on-month in November, driven by consumer goods after its 0.4% decline in October, according to data from Destatis, the Federal Statistics Office.

In Europe, the 'Sentix' index of business sentiment rose from -21 to -17 as energy prices eased.
The rise in stock market indices, which this morning penalized the bond compartment ('risk-off'), is also reversing the trend, as rates are now easing by -2pts on US T-Bonds (towards 3.55%) and Bunds are back towards equilibrium at 2.21400%... this session, it's nothing but happiness in all compartments, as oil also climbs by +2.5% to $80.50 and Gold grabs +0.5% to $1.875.
Yes, it's impossible to lose money by buying anything this Monday!

In company news, Dassault Systèmes announces that the organization of its corporate governance, unveiled on April 27, will come into effect today, making its founder Charles Edelstenne Honorary Chairman of the company, in addition to his continuing role as director.

CGG announces the start-up of a new 3D seismic reprocessing project in the Foz do Amazonas basin in Brazil's equatorial margin, scheduled for completion by the end of 2023, with first images as early as June.

On Monday, Stellantis announced the signature of an agreement with Australia's Element 25 for the supply of manganese sulfate for its electric vehicle batteries.
Finally, Vinci announces that Omexom ENR Sud-Ouest (VINCI Energies), in a consortium with SBIPB and Profil du Futur (ArcelorMittal), will build a 4.6 MWp photovoltaic plant for EDF Renouvelables in La Réunion.


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