Luxury Drags Down the CAC 40 Amid Surging Oil Prices

A Session Influenced by Geopolitics

The atmosphere remains tense in Paris. The renewed fighting around the Strait of Hormuz, a strategic passage for a significant portion of the world's crude oil exports, continues to keep energy markets under pressure. Brent crude is trading above 97 dollars, a level that weighs on global inflation and growth prospects.

In this context, the Paris index is lacking a clear direction, caught between well-performing sectors and a marked decline in luxury stocks. However, dispersion remains favorable to gains: 26 CAC 40 stocks are advancing, compared to 14 that are declining. Therefore, the index's retreat is more due to the weight of luxury giants than a generalized climate of distrust.

Publicis and Legrand Lead, Industry Holds Steady

At the top of the chart, Publicis Groupe stands out with a gain of 3.69% at 103.05 euros, leading the day’s advances. The communications group is followed by Legrand, up 2.64% at 138.10 euros. The Limoges-based specialist in electrical equipment benefits from a recommendation upgrade by Deutsche Bank, going from « hold » to « buy, » with a target price increased from 150 to 160 euros. The group also announced its non-financial rating, having retained its Platinum EcoVadis medal, within the top 1% of rated companies.

Technology and industry also lead the way. Capgemini rises by 2.28% to 107.50 euros, while ArcelorMittal gains 2.15% to 65.64 euros and Dassault Systèmes 1.67% to 22.50 euros. This trio illustrates the strength of cyclical and technology stocks in a morning otherwise marked by setbacks.

Luxury Takes a Collective Dive

Pressure is mounting on the luxury sector, which occupies the entire bottom of the table. Kering and Hermès International each fall by 2.84%, to 242.55 and 1,488.50 euros respectively. LVMH follows with a decline of 2.28% at 429 euros. EssilorLuxottica drops 1.80% to 155.85 euros, and L'Oréal slips 1.55% to 379.05 euros.

This general movement in high-end consumer stocks weighs heavily on the index composition, due to the significant weight of these giants within the CAC 40. By themselves, they are enough to push the index into the red, despite the good performance of most other components.

In other European markets, the trend remains generally more favorable than in Paris by mid-morning. The Parisian session's dynamic appears thus singular, dragged down solely by the concentration in the luxury sector, which is particularly represented on the French stock exchange.