CAC 40 Stays Afloat Midday Despite Luxury Sector Dip Following LVMH Sales Announcement

A Session of Two Faces Amidst Budgetary Backdrop

The market progresses in a scattered manner. The day's dispersion is telling: thirty stocks in the CAC 40 are rising, while ten are falling. The increase is therefore broad but weighed down by the luxury heavyweight in the index.

On the broader context, French news is still dominated by the 2027 budget. Debates on the first part of the finance bill are set to begin this Tuesday in the National Assembly, following the rejection of the revenue section in committee on October 9. Meanwhile, the yield on the ten-year OAT hovers around 4.86%, well above the German Bund, indicating a consistently high risk premium on French debt.

In Europe, the DAX is gaining 0.37% and the FTSE 100 is up 0.60% during the session. As for Monday night's close on Wall Street, the picture was mixed: the Dow Jones increased by 0.38%, while the S&P 500 dropped 0.06% and the Nasdaq 100 declined by 0.71%.

Finance, Energy, and Spirits Lead the Way

Today's biggest increase goes to Pernod Ricard, surging 3.2% to 64.46 euros. The wine and spirits giant leads the rankings, a notable contrast with the rest of the luxury sector.

Utilities follow, with Veolia rising by 2.11% to 31.94 euros. Air Liquide gains 1.36% to 171 euros, while CIC Market Solutions maintains its buy recommendation with a target of 210 euros.

Finance also contributes to the upward trend. Société Générale moves up by 1.29% to 65 euros, with KBW beginning coverage with a target of 75 euros. Commercial real estate rounds out the top of the list with Unibail-Rodamco-Westfield, up 1.26% to 88.06 euros.

Luxury Weighs Down Index Following LVMH

The luxury sector is dragging down the CAC 40. LVMH drops by 1.46% to 378.90 euros following its quarterly report. The group announced a revenue of 18,504 million euros for the third quarter, representing an organic growth of 1%, but its primary business, fashion and leather goods, declined by 5% organically, impacted by a slowdown in demand in China. Both Barclays and CIC Market Solutions have lowered their price targets while maintaining a positive outlook.

In its wake, Hermès falls 2.37% to 1,279 euros, making it the largest decline in the index. Kering decreases by 2.21% to 208.40 euros, with TD Cowen reducing its target from 280 to 235 euros.

Outside the luxury sector, STMicroelectronics loses 2.36% to 44.49 euros. The semiconductor manufacturer announced that its Supervisory Board has requested the renewal of Jean-Marc Chéry for one year, with the final decision to be made by shareholders at the 2027 Annual General Meeting. Stellantis finally slips 1.13% to 3.92 euros, after reporting quarterly sales of 1.3 million units, down 1% year-on-year.