CAC 40 Drops to Loss After Strong Open

on Feb 20, 2017

This morning started optimistically for the CAC 40, which opened to a good solid 0.54% gain on Friday’s close. However, despite initial indications that today’s session might break the downturn that led to losses on Thursday and Friday, paring back gains from a strong first part of the week, a consistent downward in place since the opening bell has taken the CAC to a 0.2% loss.

Trading is generally seeing lower volumes than normal today with U.S. markets closed for Presidents’ Day. Polls over the weekend that right-wing Presidential candidate Marine Le Pen has halved the advantage independent frontrunner Emmanuel Macron held over her in two weeks. While Macron still has a solid lead, current polls show Macron would defeat Le Pen 58% to 42% in the second round on current sentiment, the National Front leader’s progress is raising concerns that another shock win for the right jolting the international political landscape is far from an impossibility. Those concerns are one factor dampening the market’s spirits in France today.

L’Oreal has taken the heaviest loss so far today, the personal care company down 1.96%. The beauty giant recorded strong gains on Friday and has generally been on an upwards trajectory this month on solid 2016 earnings and the news that it is considering a $1 billion sale of British ethical brand The Body Shop. FMCG companies are generally doing poorly around Europe today, the sector dropping back after making headway on Thursday and Friday. Dairy group Danone, another FMCG company that had a strong Friday is also down 0.52% today.

The automakers are also having a sluggish start to the week, Peugeot down 1.32% and Renault 0.63%, as is the financial sector. BNP Paribas has slid 0.25%, Credit Agricole 1.14% and Societe Generale 1.6%. Pharmaceuticals stock Sanofi has shed 1.15% and groceries retailer Carrefour 1.39%.
Among the gainers, Airbus Group has the strongest return, up 1.64% while aerospace peer Safran has gained 1%. Construction materials manufacturer Lafargeholcim has gained 1.43%, luxury goods holdings Saint Gobain and Kering have respective gains of 0.69% and 0.73% and oil major Total 0.6%.

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