CAC 40 Drops Over 2% as Oil Crisis Pushes Markets Into the Red

An Oil and Geopolitical Shock at the Heart of the Session

The appointment of Mojtaba Khamenei to succeed his father, Ayatollah Ali Khamenei, as the head of Iran has sent shockwaves through the oil markets. Both Brent and WTI experienced extraordinary intraday fluctuations, with initial spikes exceeding 29% and 31%, respectively, before partially retracting. Such volatility in a single session is unprecedented. This dynastic succession has sparked outrage in Washington; President Donald Trump had previously expressed his desire to be involved in selecting the new Iranian leader. The diplomatic tension between the two countries adds a significant layer of uncertainty, directly impacting stock markets globally.

In Paris, the main index fell by 2.20% to 7,817.49 points at 2:10 PM. The SBF 120 followed a nearly identical path, down 2.19%. Only two stocks in the CAC 40 managed to remain in positive territory. The rest of the market was swept away in a broad and uniform downturn, reflecting a pronounced risk aversion atmosphere.

This trend is not unique to Paris. In Asia, the Nikkei 225 plunged 5.20% at the close in Tokyo, settling at 52,728 points. The Hang Seng dropped 1.35% in Hong Kong, while India's Sensex fell by 1.71%. In Europe, Germany's DAX declined 1.46% during the session, and London's FTSE 100 decreased by 0.99%.

Thales and TotalEnergies, the only survivors in a sea of red

In this almost uniformly negative landscape, only two CAC 40 stocks avoid decline. Thales is up 0.91% at 243.50 euros. The defense and technology group benefits from a tense geopolitical context that tends to favor the defense sector during episodes of international escalation.

TotalEnergies is nearly stable, with a slight increase of 0.01% at 68.01 euros. The oil giant is automatically benefiting from the surge in crude oil prices. Goldman Sachs has also raised its price target for the stock from 60 to 68 euros, while keeping its recommendation unchanged. Behind these two rare pockets of growth, Publicis (-0.11%), Pernod Ricard (-0.79%), and Capgemini (-0.82%) manage to limit their losses compared to the rest of the index, although they too are trending downward.

ArcelorMittal penalized, industrial companies on the front line

Among the steepest declines, ArcelorMittal plummets 6.51% to 44.78 euros, marking the index's most severe drop. The steelmaker faces a double blow: in addition to the unfavorable global context, JP Morgan abruptly downgraded its recommendation on the stock from « overweight » to « underweight » and slashed its target price from 53.50 to 40 euros. This complete reversal by the American bank is heavily weighing on the stock.

Following ArcelorMittal, industrial and cyclical stocks are taking a particularly heavy hit. Schneider Electric falls 4.41% to 238.35 euros. Unibail-Rodamco-Westfield, a heavyweight in commercial real estate, loses 4.38% to 93.54 euros. Legrand retreats 3.74% to 132.40 euros, and Michelin drops 3.58% to 29.92 euros. The extent of the decline in these stocks, exposed to the global economic environment, reflects the fear that the ongoing oil shock might weigh on global growth and rekindle inflationary pressures.

With 38 out of 40 stocks in the red and none stable, this session on March 9 is shaping up to be one of the toughest for the CAC 40 in recent weeks. All eyes remain on the development of the Iranian-American crisis and the final scale of oil price fluctuations, whose movements today are already historic.