European Markets Turn Lower Amid Rising Election Jitters In France and the UK

Bridgette Randall
25 Jun, 2024
Frankfurt

European markets turned lower amid election anxieties and a weak economic outlook. 

Benchmark indexes in Paris and London traded down nearly 1% as the two European nations headed for elections. 

The U.K.'s Conservative Party is likely to suffer significant losses as voter sentiment swings in favor of the Labour Party after running the government since 2010. 

In France, the far-right and far-left parties are expected to make significant gains in the snap elections scheduled for June 30 and July 7, altering the balance of power in the legislative assembly. 

Prime Minister Emmanuel Macron confirmed in a letter to the French people that he plans to stay in office and complete his term until 2027, regardless of the election outcome. 

On the light day of economic news, Spain's statistical agency confirmed the economy expanded at a faster-than-estimated pace of 0.8% in the first quarter compared to the previous quarter. 

In the initial estimate, Spain's GDP growth was estimated to grow at a rate of 0.7%. 

 

Europe Indexes and Yields

The DAX index decreased by 0.9% to 18,151.15; the CAC-40 index fell by 0.7% to 7,649.61; and the FTSE 100 index fell by 0.2% to 8,264.47. 

The yield on 10-year German bonds edged lower to 2.38%. French bonds inched lower to 3.09%; the UK gilts edged lower to 4.05%; and Italian bonds increased to 3.90%.

The euro edged lower to $1.071; the British pound inched higher to $1.268; and the U.S. dollar advanced to 89.39 Swiss cents.

Brent crude decreased $0.57 to $85.43 a barrel, and the Dutch TTF natural gas fell by €0.7 to €34.52 per MWh.

 

Europe Stock Movers

Novo Nordisk added 2.1% to DKK 1,008.80, and the Danish pharmaceutical company said it plans to invest $4.1 billion, or 27 billion Danish kroner, to build a new manufacturing plant in Clayton, North Carolina. 

Airbus declined 12.3% to €130.44 after the aerospace company lowered its 2024 financial targets and announced a one-time charge of €900 million because of supply chain difficulties and unexpected costs in its space division. 

After the Airbus announcement, MTU Aerospace declined 3.5% to €216.80, and Rolls Royce fell 4.5% to 450.20 pence. 

Merck KGaA dropped 8.5% to €153.15 after the German pharmaceutical company canceled a late-stage trial for a cancer drug. 

Saga PLC jumped 1.6% to 114.70 pence after the cruise line operator focused on the 50-year-old and older age group of adults, saying revenue in the first four months to April was strong and met management expectations.