The Parisian CAC continues to be a big winner on Tuesday, as we are rotating out of luxury in Paris, into the technology sector. As the world waits for Nvidia earnings, French traders may be “front running” the potential move.
CAC 40
The CAC 40 has seen a late-stage recovery in the trading session as we initially plunged but traders are starting to look at the reality that the US tariff threats probably aren't much worse than they were to begin with.
We've seen several earnings surprises from secondary components in the CAC such as Edenred and Forvia. Both have helped offset a 2% plunge initially. We are starting to see the index rotate out of luxury into some of the other sectors such as technology as markets await Nvidia's earnings coming up in the next 24 hours.
Immediate Support and Future Targets
I do think that there is immediate support right around the 8,400-euro level and as long as we can stay above there, I think we look pretty good. The Parisian index has broken out over the last several days and it looks very much like it's going to lead the rest of European indices higher if this keeps up. All things being equal, I think the measured move could be for the 8,800-euro level.
Any pullback at this point in time seems to be a bit of a buying opportunity but we'll have to wait and see barring some type of external threats such as the tariffs coming out of the United States for example or maybe some other geopolitical headwinds
Nonetheless, from a technical analysis standpoint, this is a very strong looking market, and I do think that Paris continues to be one of the winners. This is a market that I believe will remain strong in the near future.