Share prices of France’s leading companies plunged on October 19 as the country’s domestic political crisis escalated into mass unrest. Euronext Paris data shows the benchmark CAC 40 index, which tracks the 40 largest listed firms, fell as much as 1.46% intraday to 7,840.46 points. The equity slump coincided with a slide in the euro, while French government bonds posted the weakest yield performance among major euro area sovereigns, Bloomberg reports.
The wave of protests, which began at the weekend as peaceful school demonstrations, rapidly spread nationwide and turned into violent confrontations with police, accompanied by looting, arson, and acts of vandalism. President Emmanuel Macron, who is due to leave office next spring, delivered an emergency televised address on Sunday evening promising a tough stance against lawbreakers. Street violence, however, continued during and after the speech, intensifying panic among investors.
Analysts note that a deep political crisis repeatedly hits French business confidence. A similar market rout occurred in summer 2024 after Macron dissolved the National Assembly following his party’s defeat in the European Parliament elections, an episode that sent the CAC 40 down more than 6%. Coupled with broader macroeconomic stagnation and weakness in industry, the current unrest poses a material threat to France’s financial stability.
