French stocks experienced a significant drop on Monday, driven by concerns over a potential U.S. recession and escalating tensions in the Middle East. Reports have indicated that the Benjamin Netanyahu-led government might consider a pre-emptive strike on Iran to avert an attack on Israeli soil.
In parallel, investors dismissed the findings of a survey indicating that France's services sector activity had improved in July, ending a two-month period of contraction. The benchmark CAC 40 index fell by 137 points, or 1.9%, closing at 7,115, following a 1.6% decline on Friday.
Societe Generale's shares plummeted nearly 4% after the bank announced an agreement to sell its Swiss and British private banking divisions, including SG Kleinwort Hambros. Similarly, BNP Paribas saw a 2.2% decline, while Credit Agricole's shares dropped by 2.8%.
In the cosmetics sector, L'Oreal's shares edged down slightly. The beauty products giant announced it had acquired a 10% stake in dermatology company Galderma Group AG for an undisclosed amount.
