The CAC 40 Index Opens 0.87% Lower

The CAC 40 Index decreased -47 points or 0.58 percent on Thursday to close at 7995 points. The decline was led by Pernod Ricard (-5.05%), ArcelorMittal (-4.22%) and BNP Paribas (-3.96%). On the upside, the strongest performers were Thales (3.01%), Air Liquide (1.91%) and Edenred (1.87%).

The CAC 40 index fell 0.7% to close at 7,984 on Thursday, as escalating military conflict in the Middle East and renewed trade tensions weighed on European equities. Defiant rhetoric from Tehran regarding the closure of the Strait of Hormuz, pushed Brent crude toward 100 dollars per barrel and solidified expectations for a European Central Bank rate hike by July. While energy giants like TotalEnergies (0.6%) and defense firms such as Thales (3%) found support, the broader luxury and financial sectors faced selling pressure. LVMH and Hermes fell over 1% as investors grew cautious over the impact of potential US trade probes on high end exports. Major lenders including BNP Paribas, Societe Generale, and Credit Agricole also lagged between 2.9% and 4.1% as the market priced in the dual threats of imported inflation and rising borrowing costs. These pressures shifted the monetary outlook significantly from early February when traders still anticipated year end rate cuts.

The CAC 40 fell 0.8% to 7,979 on Thursday, extending losess from the previous session as market sentiment remained subdued amid ongoing Middle East tensions. In a recent development, Iraq shut down operations at its oil terminals after two tankers were attacked in Iraqi waters, raising concerns over regional oil supply. With Europe heavily reliant on oil imports, inflation could rise further if crude prices stay elevated. Money markets now price in an ECB rate hike by July, with an 85% chance of another increase by December. This marked a sharp shift from February expectations of a year-end cut. Sentiment was also hit after US President Donald Trump launched new trade probes targeting the EU and other economies, aimed at replacing the reciprocal tariffs struck down by the Supreme Court. Financial stocks lagged, with BNP Paribas, Crédit Agricole, and Société Générale down between 0.6% and 1.1%. Other notable losers included LVMH (-1.1%), Schneider Electric (-1%), and Sanofi (-1%).