The victory of the National Rally in the European elections and Emmanuel Macron’s announcement of the dissolution of the National Assembly caused a wave of uncertainty, worry, and nervousness in Paris’ financial center on Monday. The CAC 40 index fell significantly, with Société Générale, BNP Paribas, and Crédit Agricole experiencing significant drops in their stock prices. Companies with concession contracts signed with the State also experienced declines, including Eiffage, Vinci, and ADP.
The rise of far-right in Europe also affected European energy sector stocks. Analysts are pessimistic about Macron’s chances of regaining a majority in the National Assembly, with many questioning the feasibility of him achieving this goal. The euro fell sharply against the dollar as uncertainty over the election results loomed. This was accompanied by an increase in interest rates for French loans on bond market, indicating a lack of confidence in France’s ability to repay its debt in the future.
Investors are expressing concerns about the National Rally’s program and its potential impact on public finances, as well as recent downgrade of France’s rating by S&P Global Ratings. This has led to a significant increase in difference between rates with Germany, signaling a lack of faith in France’s financial stability. The uncertainty surrounding election results and country’s economic future continues to weigh heavily on markets.
The Paris Stock Exchange fell 1.88% in early trading on Monday following victory of National Rally in European elections and Emmanuel Macron’s announcement dissolution National Assembly . Other European markets experienced similar declines but it was more pronounced decline for CAC 40 index
