CAC 40 Tumbles On US Rate Hike Fears; Banks Underperform

(RTTNews) - French shares fell sharply on Monday, as fears of a possible U.S. interest-rate increase gripped markets.

The downturn in commodity prices on a firmer dollar, rising geopolitical tensions following North Korea's latest nuclear test and speculation that central banks are running out of stimulus options to boost growth also sapped investors' appetite for risk.

The benchmark CAC 40 was down 87 points or 1.95 percent at 4,404 in late opening deals after losing 1.1 percent in the previous session.

Financials traded weak, with BNP Paribas, Credit Agricole and Societe Generale Group losing 3-4 percent.

Industrial gas supplier Air Liquide dropped 1.5 percent after its German rival Linde and Praxair Inc. agreed to terminate talks about a possible merger.

Sanofi shares fell over 1 percent. The French drugmaker and Verily Life Sciences, an Alphabet company, are planning to invest about $500 million in a diabetes joint venture combining devices with services.