After posting strong gains late last week, the CAC index is showing little movement. The Paris exchange was closed on Monday and Tuesday. In Wednesday trade, the CAC is at 5367.80, up 0.06% since the Friday close. There are no eurozone or French events on the schedule, so traders can expect a quiet Wednesday session.
The CAC has been quiet this week, but that could change after the Christmas break, when investors return from holidays and assess the volatile political situation after the election in Catalonia. Will the stock markets react negatively to the strong showing by pro-independence parties? The vote marks a scathing rebuke for Spanish Prime Minister Mariano Rajoy, who called the snap election after imposing direct rule on the region after Catalonia declared independence from Spain. Rajoy’s heavy-handed approach has failed to curb the pro-independence movement, and Spain could be headed for more political turmoil in the coming months.
The French economy continues to rebound, as indicators in the second largest economy in the eurozone continue to point upwards. The economy has been expanding, exports are up and unemployment has dropped. Consumer spending, a key driver of economic growth, looked sharp in November, jumping 2.2%. The impressive reading comes after a decline of 1.9% in October and marked the highest gain since February 2012.
