CAC 40 Drifts Lower On Iran Peace Deal Uncertainty

(RTTNews) - French stocks drifted lower on Thursday amid lingering uncertainty about a peace deal between the U.S.-Iran, following Iran dismissing an American plan to pause the war.

Iran has said that an end to the war will only occur on Tehran's own terms and timeline.

Meanwhile, an Israeli official has reportedly claimed that the Islamic Revolutionary Guard Corps (IRGC) Navy commander, Alireza Tangsiri, who "was responsible for the closure of the Strait of Hormuz," has been killed in a strike in Bandar Abbas.

Concerns about potential interest rate hike by the European Central Bank hurt as well. European Central Bank (ECB) member and Bundesbank President Joachim Nagel said that the central bank may hike interest rates at its next meeting in April "if the war in the Middle East raises the spectre of an inflation surge in the Eurozone".

ECB President Christine Lagarde said Wednesday that anything more than a short-lived spike in inflation could warrant an increase in interest rates.

France's benchmark index CAC 40 was down 65.59 points or 0.84% at 7,780.96 a few minutes ago. The index dropped to a low of 7,758.76 earlier this morning.

ArcelorMittal dropped down by about 3.4%. Legrand slid 2.7%, while Safran, Stellantis, Societe Generale, Capgemini, BNP Paribas, Airbus and Credit Agricole slipped 1.8%-2%.

Thales, Renault, Saint Gobain, LVMH, Accor, EssilorLuxottica, Hermes International, AXA, Publicis Groupe and Engie lost 0.7%-1%.

Kering climbed more than 2.5%. Carrefour gained about 1.1%, while TotalEnergies, Danone and L'Oreal moved up 0.8%, 0.6% and 0.5%, respectively.

French firm Vinci was moving lower after it agreed to buy a toll highway portfolio in India from Macquarie Asia Infrastructure Fund 2.

Survey results from the statistical office INSEE showed France's consumer sentiment decreased in March to the lowest level in four months amid future inflationary concerns.

The consumer sentiment index dropped to 89 from 91 in the prior month, as expected.

The proportion of households who consider that prices will accelerate over the next twelve months has increased very strongly, in a context of high geopolitical tensions, the survey revealed.

Consumers' opinions regarding their future personal financial situation worsened with the index falling to -12 from -8. Meanwhile, the one related to their past financial situation was stable at -20.

The index measuring future standard of living in France weakened to -62 in March from -55 a month ago. Their future inflation expectations increased sharply, and the respective index climbed to -1 from -29.