French Stocks Resilient After Attacks With Market Little Changedby
French benchmark CAC 40 Index trims loss of as much as 1.2%
Stoxx 600 energy producers rise, offsetting drops in travel
European stock markets showed resilience after Paris suffered the region’s worst terror attacks in more than a decade, with French equities paring declines.
The CAC 40 Index closed little changed, trimming a slide of as much as 1.2 percent and briefly climbing 0.3 percent. Energy producers rallied in Europe, offsetting declines in travel shares. That sent the Stoxx Europe 600 Index up 0.3 percent, erasing an earlier drop of as much as 0.8 percent.
“Though everyone is obviously very downbeat today, market reactions have been fairly moderate,” said Teis Knuthsen, chief investment officer at Saxo Bank A/S’s private-banking unit in Hellerup, Denmark. “But the real question for investors after these geopolitical shocks is whether they will have a meaningful impact on a country’s economic performance. Unless that’s the case, lessons from history show that the impact tends to be very short-term.”
The history of terror incidents around the world over the last 15 years shows market reactions are often sharp and, increasingly, short-lived. The number of Stoxx 600 shares changing hands was about a fifth lower than the 30-day average today.
France bombed Islamic State targets in Syria after the Paris attacks killed at least 129 people on Friday. Islamic State said the terror acts were in retaliation for France’s military involvement in the Middle East.
A gauge tracking the volatility of stocks in the euro area advanced for a third day, reaching its highest level in more than a month.
Some French companies hurt by the Paris events included hotel operator Accor SA. Its shares lost 4.7 percent, the most among CAC 40 stocks. Air France-KLM Group sunk 5.7 percent, Aeroports de Paris fell 3.7 percent, and Groupe Eurotunnel SE declined 3 percent. Kering SA, which shut boutiques of brands like Gucci and Bottega Veneta, and LVMH Moet Hennessy Louis Vuitton SE retreated.
Thales SA, the French maker of radars and electronic-warfare, rose 3.3 percent.
Elsewhere, other stocks moved on corporate news. Sonova Holding AG tumbled 7.8 percent after the maker of hearing aids cut its annual sales and profit forecasts. Premier Oil Plc added 7.4 percent after selling its Norwegian assets to Det Norske.
The Paris attacks came as concerns that the global economic recovery is slowing have taken shares lower in recent weeks. The Stoxx 600 lost 2.7 percent last week, the most since the beginning of September, amid worse-than-forecast data on euro-area growth. The CAC 40 has declined almost 9 percent since April, though it is still among the best performers in developed markets for the year.