War in Iran: CAC 40 Drops Nearly 3% as Shock Spreads

A Trading Session Amid the Wages of War

The conflict in Iran is setting the tone for the Paris session this Tuesday. European markets are down between 1% and 3%, with Paris being among the most affected, falling 2.68% by midday, with the CAC 40 at 8,169.54 points.

Oil has surged nearly 10%, with Brent crude exceeding $80 per barrel. European natural gas (TTF) has jumped by nearly 25% as well. The fears stem from potential disruptions to global supply, as the Strait of Hormuz—a strategic passage for oil transit—is now being bypassed by major shipping companies. The lengthening of maritime routes is driving up hydrocarbon transport costs, fueling a significant energy shock.

Despite the magnitude of the event, several observers describe the market reaction as « moderate and orderly. » For now, investors seem to be betting on a conflict that is limited in duration. Nevertheless, the dispersion of stocks is undeniable. Only two stocks in the CAC 40 are managing to stay in positive territory, and just one is stable. Everything else is declining, sometimes sharply.

Capgemini and Euronext, Among the Few to Escape the Red

In this sea of declines, two stocks stand out. Capgemini rises by 1.16% to 105.05 euros. This rebound occurs on the day Jefferies revised its price target for the stock, lowering it from 145 to 115 euros, while maintaining its « hold » recommendation. This target adjustment clearly hasn't weighed on market sentiment, as the stock was already trading at significantly discounted levels relative to this revised target.

Euronext, the pan-European stock exchange operator, edges up by 1.07% to 141.60 euros. The group's activity is mechanically supported during periods of high volatility, allowing it to perform well in a context of extreme tensions.

Danone, on the other hand, acts as a safe haven: the stock remains perfectly stable (0%) at 71.22 euros, the only value in the CAC 40 not moving in either direction. Defensive profiles like EssilorLuxottica (-0.78%) and Sanofi (-0.86%) also limit losses, confirming the classic investor response during times of geopolitical stress: turning to sectors that are less exposed to economic cycles.

ArcelorMittal, Accor, Société Générale: Cyclical Stocks at the Forefront

At the bottom of the chart are cyclical stocks with exposure to the global economy. ArcelorMittal experienced the largest drop of the day, falling 6.38% to 51.06 euros. The steel company, highly sensitive to global economic outlooks and energy costs, is directly impacted by the combination of sharply rising oil prices and renewed uncertainty about growth.

Accor fell by 5.86% to 42.25 euros. The hotel and tourism sector is historically one of the first to be adversely affected during geopolitical shocks due to its direct exposure to international traveler flows.

In the financial sector, Société Générale slipped 5.14% to 67.58 euros. Banks, which are sensitive to the macroeconomic environment and growth prospects, are among the first to suffer on a day like this.

The luxury sector isn't spared: Kering declined by 4.83% to 258.40 euros. Unibail-Rodamco-Westfield, the commercial real estate company, lost 4.73% to 98.08 euros, hit by its cyclical nature and sensitivity to interest rates and consumer spending.

The tone of the session is clear. The energy shock caused by events in Iran and the navigation around the Strait of Hormuz affects the entire Paris stock market. While the declines are significant, the absence of a widespread panic suggests a market that, for now, is absorbing the hit, albeit with difficulty, but without descending into chaos.