The Paris Stock Exchange has experienced a notable year, with 2023 shaping up to be one of its best in the last decade. Despite challenges such as monetary tightening, banking crises, and geopolitical tensions, European stock markets have shown resilience and recorded gains in the final session of the year.
The Cac 40, a benchmark French stock market index, closed the year with a 0.29% gain, reaching 7,556.7 points and a trading volume of 300 million euros. This marks a strong finish following a 1.87% gain on the first trading day, resulting in an overall nearly 17% increase in 2023, the third best performance since 2014. The Stoxx 600, a broader European index, also saw a 0.3% gain, leading to a 13% annual increase.
The market rally has been attributed to the belief that major central banks have successfully managed the inflationary pressures of 2022-2023. Investment experts share this sentiment, contributing to the positive market outlook.
In the coming year, the S&P 500 on Wall Street is expected to continue its upward trajectory, driven by the performance of tech giants and overall market optimism. The Nasdaq Composite recorded its best annual performance since 2003, rising by 44.2% in 2023, largely due to the excitement around artificial intelligence and the dominance of tech companies like Nvidia.
Additionally, market momentum has been influenced by the anticipation of a shift in monetary policy from a tightening phase to a relaxation phase in the first or second quarter of 2024. However, some analysts are skeptical about whether the Federal Reserve can meet the market’s high expectations without risking an economic downturn.
In Asia, the Nikkei index in Japan achieved its highest annual increase since 2013, surging by 28%, while the Chinese stock markets faced challenges, with the CSI index experiencing an 11.4% decline over the year.
On the corporate front, French luxury giants like Kering, Hermès, and LVMH showed gains in the stock market, with the automotive company Stellantis recording the strongest performance of 2023.
The medtech company, Carmat, saw an 8.5% increase in its stock price after announcing an improvement in the software for its artificial heart, Aeson, reinforcing its safety profile for cardiac transplantation.
Overall, 2023 has been a year of resilience and growth for global stock markets, setting the stage for a promising 2024. The key question for investors and market participants in the new year is whether the positive momentum can be sustained in the face of evolving economic and geopolitical developments.
