FX.co ★ CAC 40 Underperforms on Luxury Stocks

On Tuesday, the CAC 40 index climbed 0.9% to settle at 7,335, showing a recovery from earlier losses in the day but still underperforming compared to its regional counterparts. This movement was influenced by optimism regarding a potential pause in U.S. automotive tariffs. However, this positive sentiment was partially overshadowed by significant declines within the luxury sector. Investor confidence was buoyed by President Trump's comments hinting at temporary tariff exemptions on imported vehicles and parts, providing automakers more time to increase their domestic production capabilities. Stellantis led the charge, surging 6.6%, while leading financial institutions like AXA, BNP Paribas, Crédit Agricole, and Société Générale saw noteworthy gains of 2.1%, 3%, 2.2%, and 5% respectively. On the downside, luxury stocks experienced sharp declines. LVMH dropped 7.8%, reaching its lowest point since December 2020, following a 3% year-on-year decrease in first-quarter revenue, which was contrary to expectations of a 2% rise. The entire luxury sector showed similar trends with Kering falling 5.2% and L’Oréal decreasing by 2%.