French Equities Show Caution at Midday as Economic Data Arrives

European markets displayed cautious sentiment on Thursday, with the French stock benchmark reflecting broader investor hesitation. At noon trading, the CAC 40 index retreated 23.59 points, settling at 8,210.33 and representing a 0.29% decline as traders navigated geopolitical uncertainties while awaiting key U.S. economic releases.

Stock Performance: Mixed Signals Across Sectors

The automotive and industrial sectors took the brunt of selling pressure. Renault led the declines with a sharp 4.1% drop, while Saint Gobain shed 3.6%. ArcelorMittal and Stellantis both weakened by 2.7% and 2.6% respectively, with Schneider Electric losing approximately 2% of its value. Smaller losses appeared across Capgemini, Legrand, Euronext, STMicroelectronics, and Bureau Veritas, each down between 1.2% and 1.7%.

On the positive side, financial stocks demonstrated resilience. BNP Paribas surged 2.15% to lead the gainers, while Pernod Ricard advanced 1.5% and Danone moved up 1.4%. Societe Generale and Credit Agricole posted more modest gains of 1.1% and 1% respectively. Defensive names like L’Oreal, Veolia Environment, Orange, Airbus, Sanofi and Engie also posted slight increases, suggesting investors rotated toward stability.

Economic Backdrop: Labor Market Softening

Recent Eurostat data provided some positive signals on employment. The eurozone unemployment rate edged down to 6.3% in November from 6.4% in October, beating expectations that had called for stability. Youth unemployment similarly improved, declining to 14.6% from 14.8%, while the broader EU27 unemployment rate held steady at 6% month-on-month.

France’s trade position, however, showed deterioration. The national trade deficit expanded to €4.2 billion in December 2025, widening from a revised €3.5 billion the previous month. Import volumes grew 2% to reach €56.4 billion, while export growth remained sluggish at 0.8%, reaching €52.2 billion—indicating potential headwinds for French export-dependent companies.

Market Takeaway

The midday session reflected the classic tug-of-war between supportive labor market data and concerns over trade weakness and geopolitical risks, leaving investors in a holding pattern ahead of American economic announcements.