The CAC 40 fell 0.7% to around 8,379 on Wednesday, extending losses for a third consecutive session as renewed tensions in the Middle East weighed on market sentiment.
The US intensified pressure on Iran by launching fresh airstrikes and revoking a sanctions waiver that had allowed Tehran to export oil to global markets.
The latest developments pushed oil prices higher, reigniting inflation concerns and clouding the outlook for interest rates.
Markets now imply roughly 32 basis points of ECB rate hike, up from 25 basis points a day earlier.
Luxury stocks were among the weakest performers, with LVMH falling 0.9%, Hermes losing 1.7%, and Kering declining 1.3%.
Financial shares also came under pressure, led by BNP Paribas (-2.1%), Credit Agricole (-1.6%), and Societe Generale (-2.4%).
In contrast, energy stocks outperformed, with TotalEnergies gaining 1.3% as surging oil prices boosted the sector.