AMF Says Market Resilience Has Not Dispelled Geopolitical, Cyber & Private-Market Risks

Key Takeaways

• Geopolitical Risk Remains Central: The AMF says trade tensions, tariff uncertainty, the Russia-Ukraine war and renewed Middle East tensions continue to weigh on markets.
• Markets Stayed Orderly: Despite correction and volatility after the Iran-related conflict began, markets remained broadly resilient.
• Structural Vulnerabilities Persist: High valuations, tech-stock concentration and corporate debt could increase market sensitivity if conditions worsen.
• Private Assets Need Vigilance: Growth and broader retail access are raising concerns around liquidity, valuation, leverage and interconnections.
• Cyber Risk Is Rising: AI, including frontier models, may improve risk management while also increasing cyber and operational vulnerabilities.

Deep Dive

France’s financial markets regulator says the past year has largely confirmed the risks it had already identified, even as markets proved capable of absorbing another period of geopolitical stress.

In its 2026 Markets and Risk Outlook, the Autorité des marchés financiers said geopolitical and cyber risks remain central concerns. Financial markets, it said, have stayed broadly orderly and resilient despite a correction and heightened volatility following the outbreak of the conflict with Iran. That resilience is not presented as a clean bill of health. It is the backdrop against which the regulator now sees familiar vulnerabilities becoming more exposed.

The AMF’s reading of the market begins with geopolitics. Trade tensions, uncertainty over tariff policies and the continuing conflict between Russia and Ukraine are still weighing on the global economic outlook. Renewed tension in the Middle East has deepened that uncertainty, making financial markets more exposed to developments that are difficult to model and harder still to price.

The economic effects of the Middle East conflict, the regulator said, will depend on how events unfold. For now, energy markets have been the main channel through which the shock has moved. Severe disruption to oil and gas supplies has pushed energy prices sharply higher, feeding renewed market volatility and helping revive inflationary pressure. That, in turn, has worsened the macroeconomic outlook and made the expected path of interest rates more uncertain and more differentiated across markets.

Yet markets did not seize up. Equity markets rebounded quickly after the conflict began, with some returning to, or even exceeding, record highs. Bond-market liquidity remained broadly favorable. French investment funds continued to record positive inflows, with no significant effect from recent geopolitical tensions.

Those facts matter because they show a financial system still able to function under strain. They also explain why the AMF’s concern falls less on the immediate market reaction than on the weaknesses that remain beneath it.

The regulator pointed again to high valuations in certain assets, the concentration of market performance in a limited number of large technology stocks and significant debt levels at some companies. Those factors could make markets more sensitive if the macro-financial environment deteriorates.

Bond markets carry their own pressures. Inflationary concerns have contributed to higher government bond yields and rising financing costs, against a backdrop of high indebtedness. Crypto-asset markets, meanwhile, remain in a corrective phase, reflecting greater sensitivity to shifts in the economic and financial environment.

The AMF also singled out investment funds as an area where favorable conditions have not erased underlying risks. Valuation effects have supported the sector, helped by rising equity markets and trends in key interest rates. But real estate funds remain exposed to weakness in the underlying property market.

Private assets are drawing closer attention as well. The AMF said the sector is not, at this stage, a significant source of financial stability risk because it remains limited in size. Still, its rapid expansion, together with broader retail access, is raising concerns over liquidity, valuation, leverage and links with the rest of the financial system. The issue, for the regulator, is not only the growth of the market but who is being invited into it.

Operational and cyber risks are moving in the same direction. The AMF said the rapid development of artificial intelligence, particularly advanced “frontier” models, could transform cybersecurity. These technologies may improve efficiency, innovation and risk management, but they also increase some cyber and operational vulnerabilities.

The EU’s Digital Operational Resilience Act, known as DORA, gives financial firms a framework for strengthening security and resilience. The regulator’s warning is that frameworks alone are not static defenses. Prevention and response systems must keep adapting if systemic risks are to be limited and financial stability preserved.

The report closes on a different kind of market participant. In 2025, France’s savings rate remained high, while interest in financial investments and exchange-traded funds continued to grow. Neo-brokers and investors under 35 have helped drive that shift. The AMF said younger investors may be more vulnerable because of certain characteristics and investment behaviors.

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