Before the Bell: Happy Black Friday!

Thanksgiving leaves markets directionless, Wall Street is open for only half a day today, and France is debating whether ArcelorMittal should be nationalised.

Wall Street still largely sets the tone for global financial markets. Yesterday, U.S. exchanges were closed for Thanksgiving, and European indices drifted aimlessly. Just look at London (+0.02%), Paris (+0.04%) or Madrid (+0.00%). Even the Euro Stoxx 50 (-0.04%) barely moved. Luckily, some individual stocks did. In Brussels (+0.17%), Montea (+2.4%) and Melexis (+2.1%) brightened the Bel20. Prosus (-2.9%) dipped in Amsterdam. In Paris, BNP Paribas added 1.5% or 1.05 euro per share — good news for the Belgian government, which still owns 63.22 million shares in the French bank.

There is also little movement this morning on Asian markets. In Tokyo, the Topix is up 0.2%; in Hong Kong, the Hang Seng slips 0.3%. Toymaker Pop Mart (+4%) is a notable riser in Hong Kong today. The producer of the wildly popular “Labubu” figurines has been a phenomenon not only in toy stores but also on the stock exchange this year. At the start of the year, the share cost 85 Hong Kong dollars; today it is 230 HKD. Still, that is below the 340 HKD investors were paying back in August. Just like its figurines, perhaps the share is merely a hype? Today, Wall Street is open for only half a day. U.S. markets start their weekend at 13:00 local time. Today we also get results from Elia (before the bell) and Inclusio and Floridienne (after the bell).

The Chinese property crisis is far from over

“Long live the bubbles!” We will likely hear it again around New Year’s. Some investors love bubbles — but only if they don’t burst while they are still inside them. Are there bubbles right now? Possibly. AI, defence stocks, gold, private debt… Which bubble bursts first? When it happens, it can take a very long time for wounds to heal. Just look at China’s property sector. In December 2021, almost four years ago, property giant Evergrande announced it could no longer repay its debt. This week we learned that sector peer China Vanke now also admits it cannot repay its obligations. Chinese property stocks fell an average of 5% this week.

So, if someone offers you a glass of “bubbles” soon, be a wise investor and say no. But if someone asks whether you’d like champagne, cava or prosecco, then by all means you may say yes.

BNP Paribas shares gain 11.4% in a week

In just one week, BNP Paribas has risen no less than 11.4%. The share is benefiting from the bank’s announcement of a 1.15-billion-euro share buyback programme. And this is exactly what makes Spaarvarkens fun: while Jan bought the shares cheaply — congratulations, Jan — I told you I preferred to stay on the sidelines for now. My excuse?

A few weeks ago, I gave a talk to clients of a private bank. Afterwards, one of the employees told me: “I agree with your outlook — except for one thing.” “How so?” I asked. “Well,” he said, “you claimed the situation in France will sort itself out. I fear things will first go badly wrong.” And mind you, the owner of that private bank… is a major French banking group! Anyway, that was my reason for staying cautious with French banks for the time being. But know this: if people truly start believing France is going bankrupt and Paris is about to crash, I’ll be ready to buy shares of French banks.

Did you know…

that the proposal to nationalise ArcelorMittal France was passed yesterday in the Assemblée Nationale? Left-wing parties voted in favour, government-aligned parties opposed, and the far right abstained.