CAC 40 Rises on U.S.-Iran Peace Pact

CAC Futures Updates

French stocks maintained a strong position in positive territory shortly after noon on Monday, driven by consistent buying across various counters as investors responded to the developments regarding the U.S.-Iran peace deal and the significant decline in oil prices. Brent crude has declined to a three-month low, now priced at $82.52 a barrel, reflecting a loss of approximately 5.5%. The preliminary framework of the Iran peace deal encompasses the cessation of the U.S. blockade of Iran and the reopening of the Strait of Hormuz. The significant decline in oil prices has contributed to alleviating inflation worries, enhancing the positive outlook in the markets. Reports indicate that an official signing ceremony is set to occur in Switzerland on June 19.

US President Donald Trump announced the agreement on Truth Social on Sunday, stating, ‘The Deal with the Islamic Republic of Iran is now complete.’ ‘Let the oil flow!’ the U.S. President exclaimed, asserting that the ‘great deal’ would usher in ‘peace and security to the whole region.’ The benchmark CAC 40 increased by 93.77 points, reflecting a rise of 1.11%, reaching 8,444.64 approximately thirty minutes after noon.

  • Stellantis, leading the CAC 40 index, experienced an increase of 5.4%. Saint-Gobain experienced an increase of approximately 5.1%, whereas Renault and Safran saw gains of 4.5% and 4.4%, respectively.
  • Airbus experienced an increase of 3.75%. Schneider Electric experienced an increase of nearly 3% following the announcement of its partnership with Foxconn focused on AI data centers.
  • Societe Generale, EssilorLuxottica, Bureau Veritas, Michelin, LVMH, Capgemini, Vinci, Hermes International, Eiffage, and BNP Paribas experienced gains of 2%-3%. Legrand, STMicroelectronics, AXA, Credit Agricole, and Publicis Groupe demonstrated robust performance with significant gains.
  • TotalEnergies experienced a decline of 4.8%. Orange experienced a decline of approximately 2.5%. Carrefour and Engie experienced declines of 1.4% and 1%, respectively. Danone, Air Liquide, Sanofi and L’Oreal experienced slight declines.

In economic news, Eurozone industrial production recorded a slight increase in April, as gains in consumer and intermediate goods counterbalanced decreases in the capital and energy sectors, according to official data. Industrial output experienced a modest increase of 0.1% from March, following a more robust production advance of 0.4%, as reported by Eurostat. Output was anticipated to increase by 0.2%. Nonetheless, this marks the third consecutive increase in production.

A separate data from Eurostat indicated that the euro area trade balance transitioned to a deficit in April, attributed to a significant increase in imports. The trade balance indicated a deficit of EUR 1.0 billion, contrasting with a surplus of EUR 4.9 billion recorded in March. In the corresponding period of the previous year, the trade surplus amounted to EUR 8.7 billion.