CAC 40 drops 0.6% as luxury sector faces the impact of Trump's tariff threats
On Tuesday, the Paris Stock Exchange experienced a pressured session, with the CAC 40 dropping 0.61% to 8,062.58 points amid low trading volumes. The luxury sector, affected by the US tariff threats on French wines and champagnes, significantly weighed on the index, while the automotive sector managed to stand out thanks to Renault's strong sales figures.
CAC 40 Struggles Amid Franco-American Trade Tensions
The Paris stock market closed in the red this Tuesday afternoon, declining by 0.61% to 8,062.58 points. The mood soured following statements from US President Donald Trump, who threatened on Monday night to impose 200% tariffs on French wines and champagnes. This announcement immediately weighed on investor sentiment, which was already cautious amid an uncertain geopolitical context. Trading remained sluggish, with volumes staying low, indicating a level of anticipation among market participants. The market's dispersion highlights this tension: only 9 stocks in the CAC 40 closed higher, while 31 ended lower, reflecting a negative consensus that prevailed throughout the day.
Luxury stumbles, automotive rebounds
Luxury stocks were the first casualties of the U.S. tariff threat. LVMH dropped 2.2%, while Kering fell 2.6%, dragging down the Paris index. These declines occurred after Morgan Stanley downgraded LVMH earlier this week, citing concerns about the French giant's valuation.
Pernod Ricard, also affected by the wine and spirits sector, managed to avoid the turmoil by gaining 1.09%. Conversely, Renault posted the best performance on the CAC 40 with a 2.25% jump, boosted by the morning announcement of its 2025 global sales: the automaker sold 2.34 million vehicles, an increase of 3.2% in a global automotive market that grew by only 1.6%. This commercial outperformance reassured investors about Renault's ability to gain market share. Euronext, the operator of the Paris Stock Exchange, also performed well, rising by 2.21%.
Capgemini Weighed Down by Restructuring Plan and Analyst Downgrade
At the bottom of the rankings, Capgemini experienced the largest drop in the CAC 40, sliding 2.77%. The technology consulting firm's stock was hit by a double whammy: firstly, this morning's announcement of a workforce reduction plan, which may result in up to 2,400 job cuts in France through reassignments and voluntary departures, justified by the need to adapt to technological shifts, particularly artificial intelligence. Secondly, Morgan Stanley downgraded its rating on the stock to « underweight » last week, adding to the selling pressure.
Eurofins Scientific also ended in the red, declining by 2.17%, while Veolia Environnement lost 1.87%. Technology stocks fared better: STMicroelectronics rose by 1.51%, and TotalEnergies gained 1.41%, benefiting from a slight rebound in oil prices.
This content has been automatically translated using artificial intelligence. While we strive for accuracy, some nuances may differ from the original French version.
