Overnight leader Peter Lawrie found the going tougher on the Golf De L'Océan course after a sparkling opening 64 at Golf Du Palais Royal - the field play both courses in a pro-am format over the first two rounds.
The Irishman carded a five over 77 in testing conditions to slip back to three under for the week.
That allowed Welshman Davies and Luiten to lead on six under as they carded rounds of 70 and 69 respectively on the Golf De L'Océan layout.
Davies, without a top-20 finish so far this season after a remarkable debut campaign last year, was a model of consistency as he posted two birdies and dropped just one shot.
“I’m really pleased with one under par today as it was really tough out there,” said Davies. “The wind is blowing hard and the gusts are very strong so it’s making it very difficult.
“But I hit it very nicely again today and holed some good putts so overall I’m very happy with the score and delighted to still be at the top of the leaderboard. Whether that stays the case this afternoon, we’ll have to see.”
Luiten is yet to win on The European Tour, and his round was more of a rollercoaster than his fellow leader's.
The Portugal Masters runner-up had two double bogeys on the par threes on his front nine, as well as a dropped shot at the ninth.
But seven birdies - four of them unanswered on the back nine - gave him a share of the clubhouse lead.
“I was good on the back nine with four birdies so that kept me going," said Luiten.
"My form was alright coming into this event. I was 18th last week in Spain and didn’t really play that great, but now I’m starting to putt a little better and hole some nice putts so it gives you a much better chance to make some birdies."
German Florian Fritsch made a mockery of the rest of the field's struggles as he birdied five of his first seven holes at L'Océan to be outright leader on seven under par.
No fewer than six players were in the clubhouse at five under - David Horsey, Mikko Ilonen, George Coetzee and Peter Hedblom from the Palais Royal and Indian pair Shiv Kapur and Jeev Milkha Singh from L'Océan.
Finland's Ilonen matched Lawrie's eight under par 64 from the first day, while on the course Welshman Liam Bond, South African Jaco Van Zyl and former US Open Champion Michael Campbell were all on five under approaching the turn.