The Paris Bourse (-0.35% to 8,150) failed to record a 9th straight week of gains, with the CAC40 eroding by -0.2% over the week.
On the technical front, the CAC 40 yesterday again stumbled on the 8,250-point zone, considered a key level, but also a profit-taking target for some traders.250 points, considered a key level, but also a target for profit-taking by some traders.
Once again, what stands out is the paucity of volume (less than E1.5 billion in 8 hours of trading), which should be closer to E2.5 billion than to E3 billion by the close.

The CAC40 is penalized by a further downturn in the luxury goods sector, with Kering and LVMH trailing the pack with -3.1% and -2.4% respectively... which also affects the E-Stoxx50 (-0.4%), but not enough to prevent it from recording a 9th consecutive week of gains, for the 2nd time in the 21st century (after October/November 2022)
An E-Stoxx close above 5.030Pts is almost certain, and the weekly score remains close to +0.9% to +1%.

No 3rd consecutive record for the time being on Wall Street, which reopened on an indecisive note: but nothing is lost, since the S&P500 is only down -0.1% and the Nasdaq is back in record territory with +0.15%, above 16,420 (it gained +2.5% over the past week).
Also noteworthy is the welcome easing (-1%) of the 'VIX' back into 'complacent' territory, to 12.8, i.e. -11.2% on the week, which is spectacular, and even more so given the valuation levels at W-Street.

The temptation to take profits is great in the face of the current high valuations, which could push traders to take some gains on current levels while awaiting new catalysts.

"There will of course be a breathing space for the market. This is necessary after the spectacular rise at the start of the year", says Christopher Dembik, Investment Strategy Advisor at Pictet AM.

"In the long term, we remain convinced that the underlying trend is upward", the analyst moderates, however.

This view is shared by Alexandre Baradez, head of market analysis at IG France, who is not known for being the most bullish strategist on the Paris stock market.

According to the analyst, the Paris index still has considerable upside potential, with the psychological rather than technical 10,000-point mark in its sights.

I obviously don't think we'll go in a straight line to these levels, but they are achievable objectives over the medium term", he told Cercle Finance.

Although the final session of the week promises to be relatively light on economic data, investors will nevertheless be focusing on the Ifo business climate index for Germany, which was published this morning.

The rise in the Ifo Business Climate Index (BCI) from an upwardly revised 85.7 in February to 87.8 in March was well above expectations (consensus 86.0; CE 85.5), reports Capital Economics. It is at its highest level since last June.

On the bond front, Bunds ended the week well, easing by -7pts to 2.3250%, our OATs by -4pts to 2.7980% and Italian BTPs by just -3.5pts to 3.636%.
On the currency front, the Dollar continued to climb: +0.4% to 1.0815 against the Euro, which lost 0.6% over the week.
This demonstrates a very different reading of Jerome Powell's announcements on Wednesday evening: Forex traders don't seem to be buying into the narrative of an "accommodating" FED... because 3 rate cuts instead of the 7 or 8 hoped for at the end of 2023, will ensure a yield of 5% for another 2 quarters.



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