CAC Ticks Lower as French Manufacturing PMI Misses Expectations

The CAC index is showing little movement in the Thursday session. Currently, the CAC is trading at 5,507.80, down 0.12% on the day. On the release front, French Final Manufacturing PMI remained unchanged at 56.1, missing the estimate of 56.7 points. Eurozone Final Manufacturing PMI improved to 58.5, just shy of the forecast of 58.6 points. On Friday, the US releases a host of employment indicators, led by nonfarm payrolls.

The CAC continues to hover at high levels, and has climbed 2.4% since October 23. On Wednesday, the CAC hit a high of 5536.40, its highest level since January 2008. The CAC was boosted by strong corporate earnings from automobile companies, led by Peugeot and Renault. The French economy continues to post strong numbers, and this has boosted French stock markets. Earlier this week, Flash GDP for the third quarter remained at 0.5%, matching the estimate. Consumer spending rebounded with a gain of 0.9%, beating the estimate of 0.6%. As well, Preliminary CPI improved to 0.1%, matching the forecast.

The Federal Reserve maintained the benchmark interest rate at 1.25%, and there were no nuggets in the rate statement. The Fed indicated that a rate increase is very likely at the December meeting, and was careful not to change any of the wording in its statement regarding future rate hikes. The rate statement noted that hurricanes had caused a decline in payrolls in September, but the Fed did not expect the hurricanes to “materially alter the course of the national economy over the medium term.” The markets appear in line with this sentiment, as the forecast for Friday’s US nonfarm payrolls is a robust 311 thousand, after a dismal decline of 33 thousand in September. Still, wage growth, which was remained soft despite the strong economy, is expected to slow to 0.2 percent.

Economic Calendar

Thursday (November 2)

  • 4:50 French Final Manufacturing PMI. Estimate 56.7. Actual 56.1
  • 5:00 Eurozone Final Manufacturing PMI. Estimate 58.6

Friday (November 3)

  • 8:30 US Nonfarm Employment Change. Estimate 311K

*All release times are GMT

*Key events are in bold

 

CAC, Thursday, November 2 at 8:30 EDT

Open: 5514.25 High: 5521.80 Low: 5502.80 Close: 5505.80

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Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.