Paris - European stock markets showed resilience after Paris suffered the region’s worst terror acts in more than a decade, with French equities paring declines.
The CAC 40 Index slipped 0.2 percent at 12:31 p.m. in Paris, after erasing a slide of as much as 1.2 percent to briefly climb 0.3 percent. The Paris attacks killed more than 130 people on Friday, and France bombed Islamic State’s nerve center in Raqqa on Sunday evening. Islamic State said the Friday acts were in retaliation for France’s military involvement in the Middle East.
The history of terror incidents around the world over the last 15 years shows market reactions are often sharp and, increasingly, short-lived. The Stoxx Europe 600 Index was little changed today, after erasing a drop of 0.8 percent and rising as much as 0.5 percent as miners and energy shares rallied. Gold and oil were among haven assets that gained today.
“Though everyone is obviously very downbeat today, market reactions have been fairly moderate,” said Teis Knuthsen, chief investment officer at Saxo Bank’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.”
A gauge tracking the volatility of stocks in the euro area advanced for a third day, heading for its highest level in more than a month. The number of Stoxx 600 shares changing hands was a fifth lower than the 30-day average.
Some French companies hurt by the Paris events included hotel operator Accor. Its shares lost 4.9 percent, the most among CAC 40 stocks. European travel companies declined the most, with Air France-KLM Group sinking 6 percent. Aeroports de Paris fell 4.7 percent. Kering, which shut boutiques of brands like Gucci and Bottega Veneta, and LVMH Moet Hennessy Louis Vuitton also retreated.
Steelmaker ArcelorMittal climbed 1.2 percent and oil company Total SA gained 1.2 percent, following the sectors’ moves. Thales SA, the French maker of radars and electronic- warfare, rose 2.1 percent.
Elsewhere, other stocks moved on corporate news. Sonova Holding tumbled 8.4 percent after the maker of hearing aids cut its annual sales and profit forecasts. Premier Oil Plc added 5.5 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 declined almost 9 percent from April through Friday, though it was still among the best performers in developed markets for the year.
BLOOMBERG