The Paris stock market is currently in a phase of consolidation at the beginning of the year, awaiting the release of economic indicators from the United States and minutes from the latest Federal Reserve meeting. Despite this, Sanofi has managed to offset the decline of the Cac 40, thanks to a boost from analysts’ recommendations.
As of Wednesday, the Cac 40 slipped by 0.37% to 7,503.25 points just before 10 AM. Over on Wall Street, there appears to be no clear trend in sight, as the S&P 500 dropped by 0.6% on Tuesday and the Nasdaq Composite experienced its worst daily performance since October, falling by 1.6%.
After a strong end to the previous year, stock markets face challenges in 2024 due to significant interest rate cuts and the smooth landing of the US economy becoming factors that investors are considering. Sovereign yields increased yesterday, reflecting doubts about the ability of these institutions to implement the extent of monetary easing anticipated by money markets.
Prior to the jobs report, traders are awaiting the release of the December ISM Manufacturing Index, the November JOLTS report, and in the evening, the minutes from the latest Federal Reserve meeting. This meeting had concluded with another hold on rates, along with a projection of three quarter-point cuts this year. Jerome Powell has hinted at the possibility of easing, but Fed officials have since put off the idea of an imminent cut.
On the corporate side, Sanofi is one of the top gainers in the Cac 40, with a 1.6% increase following an upgrade from Wolfe Research from “sector perform” to “outperform.” The analyst notes that the French pharmaceutical giant experienced a significant drop in its stock in the fourth quarter and now offers a better entry point. Sanofi is described as a company with “steady growth,” and the number of patents expiring is significantly lower than its competitors until the early 2030s.
In contrast, Alstom fell by 4.8% as Barclays, with an “underweight” rating, lowered its price target by 50 cents to 8 euros. Meanwhile, Atos rose by 2% after announcing that it will commence a due diligence phase with Airbus, as the indicative offer of an enterprise value of 1.5 to 1.8 billion euros covers the entire Big Data & Security scope. The digital services group also revealed that it is in exclusive negotiations with EP Equity Investment, the fund of Czech businessman Daniel Kretinsky, regarding the sale of Tech Foundaries, although there is no certainty that these negotiations will lead to an agreement.
