FX.co ★ CAC 40 Slides on Fed Watch and Narrow Budget Approval

On Wednesday, the CAC 40 index declined by 0.4% to approximately 8,020, extending its moderate downturn from the previous day as investors exercised caution ahead of the Federal Reserve's interest rate decision. It is anticipated that US policymakers will execute a third interest rate cut today, but may still maintain a hawkish stance. Domestically, French legislators narrowly passed the 2026 social-security budget, offering a modicum of relief to Sébastien Lecornu's minority government. Additionally, the Bank of France intends to slightly revise its growth projections for 2025 and 2026 upwards, attributing this to the French economy's resilience despite ongoing political uncertainty. In the corporate sector, luxury stocks weighed down the index, with Hermès falling by 0.8%, Kering by 0.7%, and LVMH by 0.5%. Other significant decliners included Thales, down 2.3%, Vinci, down 2.1%, and Orange, down 1.2%. Conversely, Carrefour rose by 0.5% following its announcement of a strategic alliance with JCDecaux, Carmila, and Unlimitail to enhance digital advertising in shopping centers. Additional stocks that saw gains included Société Générale, which went up by 0.9%, and Eurofins, which increased by 0.5%.