CAC 40 Drops To 2-week Low As Oil Prices Rise After Strikes On Energy Facilities

(RTTNews) - French stocks fell sharply Thursday morning, pushing the benchmark CAC 40 to a two-week low, as an escalation in tensions in the Middle East pushed up oil prices, triggering inflation concerns. Also, a hawkish tone by U.S. Federal Reserve Chair Jerome Powell on U.S. inflation added to the weak sentiment.

Shares from financial and luxury sectors are among the major losers.

The CAC 40 was down 142.05 points or 1.78% at 7,827.83 a few minutes before noon.

Following attacks by Iran on energy facilities in the Middle East, including the crucial South Pars gas field, Brent crude futures surged above $119.00 a barrel earlier in the day, and despite dropping a bit to $114.50, remains high up (nearly 6.5%) over previous close.

After leaving interest rates unchanged, Powell said in his post-meeting press conference on Wednesday that the U.S. is seeing "some progress on inflation" but "not as much as we had hoped."

Powell warned that "you won't see the rate cut" if there isn't further progress on inflation because of the broader uncertainty linked to the Middle East conflict and President Trump's tariffs.

Among the constituents of the benchmark index, only TotalEnergies (2.35%) and Sanofi (0.65%) are up in positive territory at present.

Accor is plunging nearly 10% after U.S.-based short seller Grizzly Research said it had taken a short position in the stock and made allegations about a lack of safeguards around bookings.

ArcelorMittal is down 6.5%. Societe Generale, Schneider Electric, STMicroelectronics, Kering, BNP Paribas, Stellantis, Saint Gobain and Airbus are down 3%-4%.

Legrand is down nearly 3%. Michelin, Hermes International, Renault, Credit Agricole, Safran, Bouygues, L'Oreal, Bureau Veritas, Eiffage, Unibail Rodamco, EssilorLuxottica, Eurofins Scientific, Veolia Environment, Capgemini and Carrefour are declining by 1.7%-2.8%.