The Paris Stock Exchange and other stock exchanges in the Old Continent are regaining some of the lost ground from the previous day, showing a certain resilience as the 15-day ceasefire agreed between Washington and Tehran is set to end on Wednesday evening.
Shortly before noon, the CAC 40 is up 0.2% to 8,350 points, while the Euro Stoxx 50 is up 0.5%, encouraged by the relative resilience of American indices on Monday (-0.3% at the close for the Nasdaq 100, for example).
Uncertainty still reigns regarding the war…
However, uncertainty remains about a possible resumption of talks between the United States and Iran, in Pakistan, as the 15-day ceasefire between the two countries is set to end on Wednesday night.
An American delegation led by J. D. Vance is expected in Islamabad, but Tehran has stated they do not want to “negotiate under threat” and has threatened to “play new cards on the battlefield” if the war were to resume.
The uncertainty surrounding the Middle East and the fate of the Strait of Hormuz is logically reflected in oil prices: Brent is up by about 1% to $95, while Texas WTI is similarly up to $87.
“In the future, oil markets are likely to remain very sensitive to the evolution of the geopolitical situation in the Middle East,” warns Abdelaziz Albogdady, market research & fintech strategy manager at FXEM.
“Persistent tensions could continue to drive prices up, while a credible de-escalation or the establishment of stable maritime transport conditions could trigger a new wave of massive sales,” he continues.
… and dampens morale in light of the ZEW index
Illustrating the effects of the geopolitical context on market sentiment, the ZEW index has fallen significantly into negative territory this month, dropping to -17.2 after -0.5 in March, when economists expected a drop to only around -5.
This indicator of German investor confidence in the economic prospects of their country has fallen below its low point of -14 in April 2025. For reference, it was still at +58.3 in February.
“The economic consequences of the war in Iran for the German economy go well beyond simple price increases,” explains Achim Wambach, president of the ZEW institute.
According to the economist, German companies “are concerned about long-term energy shortages, which are slowing down investments and weakening the effects of government stimulus measures.”
The evaluation of the current economic situation in Germany has also worsened for the current month, with the corresponding indicator reaching -73.7, 10.8 points lower than in March.
Thales neglected after its activity report
In Paris stock news, Thales drops by 4.4% and stands out as the worst performer in the SBF 120, with investors penalizing the weak results in Cyber and the lack of an increase in forecasts, revealed in its activity report.
The electronics group had, however, a dynamic start to the year, driven by defense, with a significant increase in orders and nearly 10% organic growth in revenues.
Another declining stock, Safran, is down by 2.4%, with the aerospace equipment manufacturer losing the support of Jefferies, who downgraded their recommendation to “hold” from “buy” previously, and reduced their target price from 350 EUR to 310 EUR.
Elsewhere in Europe, AB Foods drops by 3.5% in London after announcing a plan to split Primark, its budget clothing chain, amid disappointing half-year results and deteriorating activity in sugar.
