CAC 40 Soars 2.3% on US-Iran Peace Deal Optimism

Cac Futures Updates

The French stock market’s benchmark index CAC 40 surged over 2.3% Friday morning as investors engaged in a buying frenzy, fuelled by increasing optimism surrounding a potential U.S.-Iran peace agreement after U.S. President Donald Trump cancelled previously scheduled military actions against Iran. The significant decline in oil prices also played a role in fostering a positive sentiment within the market. Brent crude futures fell to $85.80 a barrel before recovering slightly to $86.51, remaining approximately 4.3% below the previous close.

Trump announced that a ‘great settlement’ has been achieved to resolve the conflict with Iran, indicating that a signing ceremony may occur in Europe as soon as this weekend. However, Tehran stated that no final agreement has been sanctioned and that disagreements regarding frozen assets and the security of the Strait of Hormuz persist. The CAC 40 increased by 184.93 points, reflecting a rise of approximately 2.25%, reaching a level of 8,385.73 just moments ago.

  • Kering increased by 6.3%, whereas Stellantis and Societe Generale both rose by nearly 6%. Saint Gobain advanced 5.8%, while Accor, Hermes International, ArcelorMittal, Safran, BNP Paribas, and LVMH recorded gains between 5% and 5.55%.
  • EssilorLuxottica, Renault, and Airbus experienced an increase of 4% to 4.75%. Michelin, Eiffage, Vinci, and Credit Agricole experienced an increase of nearly 3%.
  • L’Oreal, Pernod Ricard, Bouygues, STMicroelectronics, Publicis Groupe, Danone, Schneider Electric, Unibail Rodamco, Air Liquide, AXA, Bureau Veritas, and Eurofins Scientific also posted strong gains.
  • TotalEnergies experienced a decline of 4%. Dassault Systemes and Orange experienced declines of 2.1% and 1.1%, respectively.

Final data from the statistical office INSEE indicated that France’s inflation accelerated as projected in May, driven by increased energy and services costs, rising to 2.4% for the month, up from 2.2% in April. This marked the peak since February 2024, at which point inflation stood at 3%. The inflation rate aligned with the initial estimate released on May 29. Harmonised inflation similarly increased to 2.8%, aligning with estimates, up from 2.5% in the prior month.

Consumer prices increased by 0.1% month-on-month, aligning with estimates, following a 1% rise in the previous month. Similarly, the harmonised index of consumer prices increased by 0.1%, aligning with expectations, after a previous rise of 1.2%. Similarly, EU harmonised inflation decreased to 2.7%, as projected, down from 2.9% the previous month.