CAC 40 closes nearly flat despite bank plunge, EssilorLuxottica soars
The Paris Stock Exchange ended Friday, October 17, on a mixed note, with the CAC 40 index barely slipping 0.18% in a contrasting session. While banking stocks weighed heavily on the market, affected by concerns over regional American institutions, the spectacular performance of EssilorLuxottica helped limit the damage. The Franco-Italian optical giant soared nearly 13% following the release of quarterly results described as historic. This sectoral dichotomy highlights the prevailing market nervousness, caught between strong corporate reports and ongoing macroeconomic concerns.
EssilorLuxottica brightens a dull session, luxury holds steady
The undisputed star of this session was EssilorLuxottica, which surged 12.98% to 312.50 euros, marking the strongest gain in the CAC 40. This leap followed the release of exceptional quarterly results, with the group reporting an 11.7% increase in revenue at constant exchange rates for the third quarter, reaching 6.86 billion euros. Francesco Milleri and Paul du Saillant, executives of the group, hailed it as the « best quarter since the group's formation » in 2018.
The significant contribution from AI-powered smart glasses, sold under the Ray-Ban Meta and Oakley Meta brands, particularly impressed investors. Over the first nine months of the year, revenue rose to 20.89 billion euros, up 8.8%. The luxury sector as a whole showed notable resilience. Hermès International advanced 1.34% to 2,191 euros, while L'Oréal climbed 1.11% to 390.65 euros.
LVMH gained 0.58% to 605.70 euros, following quarterly results published earlier in the week showing 1% organic growth, considered encouraging in a challenging environment. Kering also ended slightly higher, up 0.34% to 309.55 euros, despite a downgrade from Berenberg which lowered the stock to « Sell. » Among other notable increases, Pernod Ricard surprised by rising 2.72% to 89.20 euros, even as the group reported disappointing results with a 7.6% drop in first-quarter sales, particularly impacted by China and the United States.
Banks Weighed Down by American Concerns
On the other hand, the banking sector has borne the brunt of concerns related to the difficulties faced by two US regional banks. Société Générale experienced the largest drop in the CAC 40, falling 5.10% to 53.64 euros, followed by BNP Paribas, which declined 3.96% to 74.89 euros. Crédit Agricole decreased by 2.45% to 16.49 euros.
This mistrust stems from announcements by Zions Bancorp and Western Alliance Bancorp, two American institutions that revealed they had been victims of dubious and fraudulent loans. Zions Bancorp provisioned $50 million for losses on unpaid commercial loans, while Western Alliance initiated fraud proceedings against certain borrowers.
These revelations have rekindled the specter of the regional banking crisis of March 2023, triggered by the collapse of Silicon Valley Bank. Although analysts believe the current risks are more contained than in 2023, the contagion has nonetheless spread to European institutions out of caution.
The defense and industrial equipment sector was not spared either. Thales dropped 3.31% to 245.40 euros, Safran fell 1.95% to 296.90 euros, and Airbus declined 2.46% to 200.40 euros. Schneider Electric lost 2.48% to 246.10 euros, while Legrand slid 2.86% to 144.45 euros, despite strong fundamentals for these latter two stocks. STMicroelectronics also suffered, with a decrease of 1.76% to 24.82 euros, amid a challenging environment for the semiconductor sector.
Diverse Trends in Other Sectors
In the telecommunications sector, Orange increased by 1.77% to 14.34 euros following developments with SFR. The historic operator, alongside Bouygues Telecom and Free, is maintaining its offer to purchase part of Altice France’s assets despite the group’s initial rejection. This valuation of 17 billion euros continues to fuel discussions, even though the Economy Minister has expressed being « extremely vigilant » about the potential impact on consumers.
Danone's stock gained 1.60% to 77.52 euros, continuing its technical rise after surpassing the 77-euro resistance point. Renault rose by 1.15% to 34.39 euros, while Stellantis increased by 0.89% to 8.91 euros. This came as the automaker announced a 13 billion dollar investment plan in the United States over four years, aiming to create more than 5,000 jobs. Accor ended up by 0.56% at 41.57 euros, buoyed by the announcement of numerous hotel and resort openings planned for 2025.
TotalEnergies' stock slightly increased by 0.27% to 52.71 euros as the group continued its strategy to attract American investors ahead of a direct listing on Wall Street. Finally, in the insurance sector, Axa declined by 1.97% to 39.41 euros following the announcement of a management reshuffle, with Mathieu Godart appointed as CEO of Axa France starting December 1.
This content has been automatically translated using artificial intelligence. While we strive for accuracy, some nuances may differ from the original French version.
