French stocks slide as violent riots disrupt markets

The CAC 40 benchmark index in France dropped by 1.02 percent following widespread unrest that shook the eurozone’s second-largest economy. The decline occurred as the nation grapples with sluggish growth and rising debt levels.

Riots and police clashes reported

According to the French Interior Ministry, Saturday demonstrations escalated into rioting across various cities. Approximately 2,400 individuals were arrested during the disturbances, which involved intense clashes between rioters and police forces.

Ministry reports indicated that nearly 1,000 police officers and gendarmes sustained injuries. The unrest resulted in looted or vandalized storefronts, while graffiti covered numerous buildings throughout the country.

Austerity drives political tension

The turmoil coincides with efforts by the minority government led by Sébastien Lecornu to secure €54 billion ($61 billion) in savings within the 2027 budget. These measures aim to reduce the country’s expanding fiscal deficit.

France has faced persistent challenges in curbing expenditure and managing its debt burden in recent years. By the second quarter, total debt reached a record high of €3.6 trillion, equivalent to 119 percent of gross domestic product.

This accumulation represents an increasingly costly liability amid globally elevated interest rates. The underlying protests stemmed from complaints regarding rising prices and deteriorating public services.

European indices react to volatility

The broader European Stoxx 600 index slipped 0.39 percent to 642.24 points by 07:08 GMT. This reversal followed a gain of more than two percent recorded during the previous week.

Banking shares suffered the steepest losses, falling 1.4 percent. In Spain, the main index—dominated by banking stocks—declined by 0.9 percent.

Investors await corporate earnings

Market participants are monitoring upcoming results from major European and American corporations. Investors seek to restore risk appetite after a sell-off in artificial intelligence-linked stocks last week.

That earlier downturn was driven by concerns over the substantial debt required to finance AI infrastructure. Amid this uncertainty, individual equities showed mixed performance.

Norwegian salmon producer Mowi saw its shares rise 4.1 percent. The company reported that its third-quarter production volume hit an all-time high.