The Paris Bourse has just hit the -2% mark (with the CAC40 dropping to 7,706), dragging the Euro-Stoxx50 (-1.7%) below 4,950pts (medium-term supports are very close).

After reopening in record territory, the US indices reversed course, with the S&P500 dropping from 5,442 to 5,415 (-0.1%) and the Nasdaq returning from a new high of 17,741 to 17,650 (+0.3%).
Nvidia (NVDA) had started the day on a new record high (+4% to $129.7), but this was no longer enough, as a majority of stocks fell back.
The Nasdaq-100 (+0.5% to a high of 19,640) seemed irresistibly drawn towards 20,000Pts in the wake of Broadcom (+15% to $1.710) or Tesla with +3.5% at $185.

It's worth wondering whether Wall Street isn't benefiting from the chaotic political situation in France and the downturn in European indices: investors are changing continents, but not abandoning equities. Money is only crossing the Atlantic again to invest on Wall Street, primarily in the Nasdaq titans.

Today's US figures only serve to reinforce US investors' confidence in disinflation: US producer prices (PPI) unexpectedly fell by -0.2% in May (to +2.2% year-on-year) due to lower energy prices, according to statistics released by the Labor Department on Thursday.

Economists were forecasting a 0.1% month-on-month rise (after +0.5% in April).

The 'core' index, which measures underlying pressure on producer prices (excluding food, energy and commercial services), was perfectly stable last month, following a gain of 0.5% in April, and stands at +3.2% over 12 months.

The Labor Department announced that 242,000 new US jobless claims were registered in the week to June 3, up 13,000 on the previous week.

The four-week moving average - more representative of the underlying trend - came in at 227,000, up by 4,750 on the previous week.

But these "encouraging" figures were hampered by Jerome Powell's comments, which dashed investors' hopes of monetary easing.

His new interest rate projections - the famous "dot plots" - now show only one rate cut in 2024, compared with three up to now.

Of the 19 members of the Monetary Policy Committee (FOMC), four expect no rate cuts this year, seven expect one and eight expect two.

"This FOMC is not really a game-changer (...) but it is a little more hawkish than expected", comments Bastien Drut, head of strategy and economic research at CPRAM.

Powell is making an effort to decentralize Fed policy from its price stability mandate and focus a little more on the labor market", adds the economist.

But the more restrictive stance of US monetary policy has not dissuaded investors from continuing to place massive amounts of capital on Wall Street.

T-Bonds continue to ease in the wake of Tuesday's session (-1.7 basis points to 4.275%), with the '2-year' erasing -5 basis points to 4.7050%.

In Europe, Bunds improved by -2.5pts to 2.51% and continue to gain ground against our OATs, which gained +3.5pts to 3.1900%, i.e. +68pts spread (vs. 49pts last Friday).

NB: the yield on the Portuguese 10-year bond is now slightly lower than our OATs (hovering on Thursday between 3.16 and 3.1920%).

The session promises to be poor in terms of macroeconomic indicators on the Old Continent, but the publication of industrial production in the eurozone disappointed with a 0.1% decline deemed "unexpected".

In April 2024, seasonally-adjusted industrial production fell by 0.1% in the eurozone and rose by 0.5% in the EU, compared with March 2024, according to estimates from Eurostat, the European Union's statistical office.

Consumer prices in Spain, calculated using harmonized European standards, rose by 3.6% year-on-year in May, confirming an initial estimate provided at the end of last month.

On the bond market, ten-year "Bonos" edged up slightly (+1.7Pt) to 3.383% (only 20Pts separate them from our OATs).

The dollar, which had gained +1% the previous day, lost -0.4% against the euro, which returned to the $1.0780 mark.

The oil market remains bearish after figures from the Energy Information Administration (EIA) showed a rise in US crude inventories.

Brent grabs back 0.3% to $82.7 a barrel, as does US light crude (West Texas Intermediate, WTI), which returns to $78.5.

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