CAC 40: customs duties outweigh Nvidia

(CercleFinance.com) - The Paris Bourse is expected to open slightly lower on Thursday morning, with the US announcement of new tariffs against European products outweighing the better-than-expected results unveiled by Nvidia.


At around 8:15 a.m., the 'future' contract on the CAC 40 index - expiring in March - gave up 30.5 points at 8129.5 points, suggesting that the session could start in negative territory.

Last night, Nvidia reported a record performance for its fourth quarter, with earnings per share (EPS) of $0.89, well ahead of the consensus target of $0.84.

The graphics processor maker generated sales of $39.3 billion, corresponding to a 78% year-on-year jump in business.

'These figures show that the hype surrounding AI is not about to die down, with the chipmaker still able to post outstanding results despite the recent emergence of Deepseek', reacted Pepperstone strategist Michael Brown.

Danske Bank's team added: "The publication allayed fears of a bubble forming around capital spending on AI".

Although Nvidia's results seem to have brought some relief to investors, the stock was still down almost 1.5% in pre-market trading, the victim of some profit-taking after its recent rebound (+10% over the past month).

Over the past ten days or so, equity markets have become more vulnerable due to concerns about the health of the economy, particularly in the United States.

Last night's announcement by Donald Trump of his intention to impose 25% tariffs on European products did little to rouse Wall Street.

These protectionist measures have, however, rekindled fears of a trade war between the USA and Europe, which could weigh on global economic growth.

In this respect, the three-month and ten-year US bond yield curves inverted yesterday, a sign that the world's leading economy could be heading for recession.

This inversion - characterized by the passage of a very short-term rate above a long-term rate - saw the yield on three-month Treasuries (4.31%) exceed that on ten-year securities (4.25%).

This phenomenon is seen by many economists - starting with those at the Fed - as a harbinger of recession.

However, by closing at around breakeven, the S&P 500 index managed to put an end on Wednesday evening to a negative run of four consecutive sessions in the red.

Against this backdrop, investors' attention will turn today to the second estimate of US growth in Q4, which is expected to be confirmed at 2.3%.

Naturally, given persistent concerns about the state of the US economy, any downward revision is likely to be harshly punished, probably more so than is usually the case with such data", warns Pepperstone strategist Michael Brown.

Investors will also be watching the figures for jobless claims and durable goods orders, also due in the early afternoon.

On the foreign exchange market, the euro fell back to around 1.0475 against the dollar after the US President announced sanctions on products imported from Europe.

However, traders are putting the threat into perspective, as Trump has refrained from communicating an implementation date for his new tariffs, which he often uses as leverage to negotiate on other issues.

Oil prices continue to rise, buoyed by yesterday's announcement of a drop in US crude inventories, even if they remain held back by persistent worries about global demand.

West Texas Intermediate (WTI) crude gained 0.2% above $68.7 a barrel, while Brent gained 0.3% around $72.7.

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