Paris Stocks Tumble Amid Middle East Tensions

(MENAFN) Paris stocks extended a punishing two-day selloff Tuesday, with the benchmark CAC 40 shedding more than 2.71 percent as deepening Middle East hostilities rattled investor confidence and sent crude prices surging to a 19-month high.

By approximately 13:00 local time, the CAC 40 had shed 227.75 points to stand at 8,166.57 — after briefly plunging past the 3 percent threshold earlier in the session. The decline compounded Monday’s significant retreat, when the index closed down 186.43 points, or 2.17 percent, at 8,394.32.

The rout traces directly to Saturday’s large-scale joint strikes by the United States and Israel against Iran, with the Trump administration signaling the campaign could stretch on for weeks or longer — a prospect that has driven a pronounced shift toward risk-off positioning across global markets.

Local analysts said market focus has rapidly pivoted back to inflation risks, driven by the spike in crude prices following Iran’s announcement Monday that it had closed the Strait of Hormuz — a critical maritime artery through which a substantial share of global oil supplies flow.

Brent crude, the international benchmark, surged roughly 9 percent Tuesday to trade above $85 per barrel — its steepest level since July 2024 — amplifying concerns over energy-driven inflationary pressure.

According to a French news channel, 39 of the stocks comprising the Paris benchmark index were pulled into negative territory Tuesday, reflecting the breadth and severity of the risk aversion sweeping through European equity markets.

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