The Paris Bourse was heavier at the end of the session (+0.08% towards 7282Pts), but showed resilience given the deepening losses on Wall Street, with gaps ranging from -0.6% for the Dow Jones to -0.7 to -0.9% for the S&P500 and Nasdaq.

Investors are cautious as they await announcements from the Fed's Strategy Committee, which begins today and concludes tomorrow with a press conference by Chairman Jerome Powell.

The general consensus is that the Fed should leave rates unchanged, with the probability of a rate hike deemed virtually nil, since the FedWatch barometer rates the 'status quo' scenario at 99%.

César Perez Ruiz, Head of Investments at Pictet Wealth Management, comments: "While the 25 basis point increase in the Fed Funds rate adopted in July was probably the last of the current cycle, the Fed will remain vigilant with regard to inflation, and the first rate cuts will not take place before the second quarter of 2024.

Elsewhere, the Fed will be eagerly awaited for its 'dots', i.e. the interest rate forecasts of its officials.

Among the day's statistics, investors took note of US housing starts in August: the Commerce Department reported a fall of 11.3% to 1,283,000 at an annualized rate, a level well below economists' expectations.

On the other hand, US housing permits - which are supposed to predict future housing starts - rose by 6.9% to an annualized rate of 1,543,000 last month, well above the market consensus.

In Europe, the annual inflation rate for the Eurozone stood at 5.2% in August 2023, compared with 5.3% in July, and for the European Union at 5.9% after 6.1%, according to Eurostat, which had announced a flash estimate of 5.3% for the Eurozone in August.

The lowest annual rates were observed in Denmark (2.3%), Spain and Belgium (2.4% each), while the highest were recorded in Hungary (14.2%), the Czech Republic (10.1%) and Slovakia (9.6%).

The strongest contributions to the eurozone's annual inflation rate came from services (+2.41 percentage points, pp), followed by food, alcohol and tobacco (+1.98 pp), industrial goods excluding energy (+1.19 pp) and energy (-0.34 pp).

The OECD has also revised downwards its forecast for EU inflation to end 2023, from 5.3% to 5.2%, but has also lowered its GDP forecast from 0.8% to 0.6% for 2023 and from +1.3% to +1.1% for 2024.

In France, on the other hand, the forecast has been raised from +0.8% to +1%, while the Banque de France still expects +0.9%.

From a fundamental point of view, and in the central scenario of sluggish growth, market potential remains well above 10% for eurozone equities, stresses Ginjer, who believes that upside potential is even greater for certain neglected stocks, such as financials and industrials.

The bond sector continued to deteriorate on Tuesday, with the yield on ten-year Bunds rising by +2pts to 2.7370%, and +1.8pts on our OATs to 3.283%, matching the worst levels seen this year, and even since 2008.

The situation is just as alarming for Treasuries, whose yields are not content to simply retrace their August 21 zenith (4.35%), but are breaking through to 4.369%, a new annual record and a peak since mid-June 2008.

On the currency markets, the dollar is consolidating on the margins as it awaits the Fed meeting, hovering on either side of the 1.0665 threshold against the euro.

Crude oil prices continue to rise, with Brent gaining 0.8% to set a new annual record of $95.4 in London ($95.95 at the session high), while US light crude (West Texas Intermediate, WTI) climbs 1% to $92.

The end of the day will be marked by Instacart's IPO, priced at the upper end of the $28-$30 range, valuing the home grocery delivery specialist at around $13 billion when it debuts on the Nasdaq this Tuesday.

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