The Paris Stock Exchange is expected to open slightly higher on Monday, ready to rebound slightly after a negative week, against a backdrop of geopolitical uncertainties.
The futures contract for the flagship CAC 40 index gained 0.29% about forty minutes before the opening of the session. On Friday, the index lost 1.52%, falling to its lowest closing level since January 5. For the week, the Paris Stock Exchange dropped 2.67%, its worst weekly loss since early July. Investors continue to monitor the evolving conflict in the Middle East, and particularly the risk of regional escalation. “The events of the weekend have offered hope for a compromise,” said Michael Hewson, analyst at CMC Markets, referring to the “continuous flow” of aid promised to Gaza by the United States and Israel, and the release of two American hostages by Hamas on Friday.
Oil prices are falling in this context, by about 1% for the two reference contracts, but the clashes in the border area between Israel and Lebanon remain a concern for the markets. The Israeli army has massed tens of thousands of soldiers on the outskirts of Gaza and its northern border with Lebanon. At this border, deadly exchanges of fire have multiplied between the army and Hezbollah, while residents on both sides are evacuating the border area. The Israeli army accused Hezbollah on Sunday of seeking military escalation at the risk of dragging Lebanon into a war.
In economic news, company results will continue to occupy investors’ minds this week, ahead of the European Central Bank (ECB) meeting. The ECB is expected to leave its rates unchanged on Thursday at a meeting held in Athens, a first after ten consecutive rate hikes, as inflation in the eurozone is sharply declining leaving it little choice. On the bond market, yields on 10-year US Treasury bonds are hovering around 5%, driven by the prospect of the US central bank maintaining high interest rates for a long time. Dassault Aviation: Saudi Arabia has asked Dassault Aviation for a quote to acquire 54 Rafale aircraft, as the kingdom has so far sourced its combat aircraft from the Americans and the British, according to La Tribune Dimanche.
