The CAC 40 ended sharply lower on Monday, April 20, as optimism about a resolution to the conflict in the Middle East was severely dashed.
The Paris Stock Exchange started the week with a pronounced decrease. The CAC 40 fell by 1.12% to 8,331.05 points at the close of Monday, April 20.
Investors were euphoric on Friday, but their optimism quickly faded. Despite the markets being boosted by the announcement of the reopening of the Strait of Hormuz on Friday, the optimism did not last long.
“There was a turnaround in a few hours: while Donald Trump announced the reopening of the Strait of Hormuz and the resumption of maritime traffic at the end of last week, Iran, which had initially declared the reopening of the strait to navigation, reversed its decision over the weekend after Trump clarified that the American blockade of Iran would remain in effect until the conflict is resolved,” explained Alexandre Baradez of IG France.
Totalenergies rises
“Then the situation deteriorated further, with a US Navy destroyer opening fire on an Iranian cargo ship in the Gulf of Oman after it tried to break an American naval blockade,” added the market specialist.
The ceasefire between the United States and Iran expires in two days, and representatives from both sides are supposed to meet on Monday evening in Islamabad for new negotiations. However, Tehran has stated that this meeting is not on the agenda.
“It is not certain that a second round of negotiations will take place this week. This diplomatic shift is partly due to the power vacuum within the Iranian government. With many key figures in the leadership eliminated, it is uncertain whether a single figure has the authority and capability to conclude an agreement with the United States that all parties would respect,” observed Lizzy Galbraith of Aberdeen Investments.
“It is also possible that both sides are seeking to strengthen their bargaining power before the next round of talks, while fundamentally seeking an agreement. President Donald Trump has reiterated his threat to strike Iranian power plants and bridges if the ceasefire collapses. The Iranian leadership seems to consider this threat credible and is trying to avoid triggering it,” she added.
Oil prices are on the rise following these developments. The June contract for Brent crude oil rose by 5.41% to $95.24 per barrel, while the May contract for WTI traded in New York increased by 5% to $86.67 per barrel.
On the CAC 40, Totalenergies gained 1.8%, supported by the rise in oil prices. Outside the CAC 40, Air France-KLM lost 2.6%, weighed down by the surge in oil prices, which implies higher fuel costs.
In the currency market, the euro gained 0.2% against the dollar at $1.1784.
Julien Marion – ©2026 BFM Bourse
