(AOF) – Société Générale fell 7.30% to 24.12 euros, Crédit Agricole lost 4.78% to 13.94 euros and Bnp Paribas fell 5.32% to 62.83 euros. On the Paris Stock Exchange, banks are the main losers from Emmanuel Macron’s decision to dissolve the National Assembly following the victory of the National Rally in the European elections. The sector is strongly penalized by the increase in French political risk because it constitutes the heart of the country’s economy.
If other European banking stocks are also in the red, their decline is significantly less pronounced than that of French financial institutions.
“Stocks most exposed to France or domestic stocks, such as banks and utilities, could be most affected by political uncertainty in the short term,” Barclays explains. Before warning: “The French elections taking place less than a month before the Paris Olympic Games, we must expect a lot of turmoil, which could also have an impact on the business and consumer climate.”
On the rates market, the gap between the yield of the German 10 – which serves as a reference in Europe because this country is considered the most rigorous from the point of view of public finances – increased by 4 basis points compared to its French equivalent and 5 basis points relative to the Italian 10 years.
This spread is considered on the stock market as a measure of financial risk in Europe. The larger it is, the higher the risk, hence the decline in bank values.
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