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Paris and Milan are preparing to open trading with a strong rise after the outcome of the first round of the French parliamentary elections and the euro shows a clear rise, reaching 1.0760 dollars (1.071 on Friday evening).
The futures on the Cac40 of Paris show an increase of around 2.7%, after the price list was the worst last week, losing 2%, while the futures on the Ftse Mib of Piazza Affari show +1.4% (-0 .5% last week). Increase close to 1% for contracts on the Frankfurt Dax.
The French vote confirmed the trends of the day before with the affirmation of Marine Le Pen’s Rassemblement National, credited with around 34%, and the left-wing New Popular Front at 28% while the formation of the President of the Republic, Emmanuel Macron, stopped at around 21%: for the moment however Le Pen would not have an absolute majority of the National Assembly and the first declarations on the will to create an anti-RN block in the second round on 7 July leave open the evaluations on the future French political structure. “A blocked parliament is far from being politically ideal, but it is not necessarily the most unfavorable outcome for the market. For this reason, OAT-Bund spreads could benefit, but we are struggling to see a consistent and sustainable recovery” is the comment of Peter Goves, Head of Developed Market Debt Sovereign Research at MFS IM, following the vote.
Oil up half a percentage point: Brent September is trading at 85.45 dollars per barrel, Wti August at 82 dollars per barrel. Gas up 0.4% in Amsterdam at 34.6 euros per megawatt hour.
During the week, the political factor will remain one of the key ones with the elections in the UK (on July 4) that will be added to the wait for the second round in France (Sunday 7) while, on the economic side, the Sintra central banks forum organized by the ECB starts today with several interventions by Christine Lagarde and Jerome Powell. On the macroeconomic front, tomorrow is the June inflation of the eurozone. Friday is the monthly report on the US labor market.
