French business activity contracted to a five-month low as Iran war threats derail economic recovery. S&P Global's Composite PMI fell to 48.3 in March from 49.2, marking the fastest decline since October. The reading remained below the 50 threshold separating growth from contraction, with analysts expecting 49.3.

Manufacturing stayed in positive territory, improving slightly from the previous month, while the services gauge sank to 48.3. Joe Hayes from S&P Global noted France's "burgeoning recovery looks to be on ice" as business confidence deteriorates amid inflation concerns and supply disruptions.

The Middle East conflict has sent energy costs surging, potentially causing faster inflation, higher interest rates, and slower economic expansion across Europe. France had been weathering political and financial instability but now faces external threats beyond its control. Euro-zone data due at 10 a.m. CET may reveal further regional impact.

The divergence between French weakness and expected resilience in UK and US PMI readings above 50 highlights Europe's vulnerability to geopolitical shocks. France's economic revival faces immediate headwinds as the Iran war threatens to reverse recent progress toward growth.