EUROPE MARKETS: French Stocks Slide After Paris Attack Fuels Election Uncertainty

Date : 04/21/2017 @ 4:48AM
Source : Dow Jones News
Stock : FTSE 100 (UKX)
Quote : 7323.98  -63.89 (-0.86%) @ 11:35AM

EUROPE MARKETS: French Stocks Slide After Paris Attack Fuels Election Uncertainty

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By Sara Sjolin, MarketWatch

Eurozone PMIs rise to 6-year highs and beat forecasts

European stocks struggled for direction on Friday, with France's benchmark index sliding after a suspected terror attack in Paris just days ahead of a presidential election vote.

The Stoxx Europe 600 index rose 0.1% to 378.50, trimming its weekly loss to 0.6%.

The pan-European benchmark on Thursday rose 0.2%, buoyed by a rally in French stocks. The CAC 40 index jumped 1.5%, its biggest one-day percentage gain since early March. That rally in Paris came as markets started to price in the prospect of a win for centrist presidential candidate Emmanuel Macron.

But on Friday, the CAC fell 0.4% to 5,058.24 after a gunman late Thursday opened fire (http://www.marketwatch.com/story/gunman-slain-after-killing-paris-police-officer-trump-suggests-terrorism-2017-04-20) on the Champs-Élysées boulevard in Paris, killing a police officer and wounding two others. The attack could give a late-campaign surge in support for anti-immigration, far-right candidate Marine Le Pen in the tight presidential race, analysts said. The first round of voting takes place Sunday.

Read:When are the French election results out on Sunday? (http://www.marketwatch.com/story/when-are-the-french-election-results-out-on-sunday-2017-04-20)

"Last night's terrorist attack in Paris, which given the tightness of the polls, could influence events, leaving investors to face the prospect of a face-off between Marine Le Pen on the right and Melenchon on the left. Any such outcome is unlikely to be well received by the markets," said Michael Hewson, chief market analyst at CMC Markets, in a note.

Le Pen has vowed to hold a referendum on France's membership of the European Union, fueling fears of a breakup of the bloc. One of her three key rivals, far-left euroskeptic Jean Luc Melenchon, has also pledged to renegotiate EU treaties and hold a referendum.

Read:Here's how France's hotly contested election could rattle markets (http://www.marketwatch.com/story/heres-how-frances-hotly-contested-election-could-spark-market-turmoil-2017-04-19)

Individual benchmarks: Other European markets were largely flat in Friday's trade. Germany's DAX 30 index was up 0.03% at 12,032.74, while the U.K.'s FTSE 100 index rose 0.1% to 7,125.77.

Economic news: Preliminary readings on April purchasing managers' indexes for the eurozone, France and Germany were all released Friday morning.

All three flash readings for the eurozone -- the composite, manufacturing and services PMIs -- rose to six-year highs and came in better than forecast.

France's preliminary PMIs also beat expectations, with the composite reading jumping to a 71-month high at 57.4.

For Germany, the manufacturing PMI came in slightly better than expected, but the gauge of the services sector missed forecasts.

Movers: Shares of Software AG (SOW.XE) jumped 4.5% after the company reported a smaller-than-expected drop in underlying earnings.

WS Atkins PLC (ATK.LN) rose 4.2% after SNC-Lavalin Group Inc. (SNC.T) said it will buy the U.K. engineering company for GBP2.1 billion ($2.69 billion).

Shares in German soccer club Borussia Dortmund GmbH & Co. KGaA (BVB.XE) added 2.2%. The gain came after police charged a Russian-German man (https://www.wsj.com/articles/dortmund-bomb-suspect-bought-stock-options-on-soccer-attack-1492758515) with being behind the bomb attack on the Borussia Dortmund team bus last week, alleging he was hoping to make money on a drop in the stock price.

 

(END) Dow Jones Newswires

April 21, 2017 04:33 ET (08:33 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.


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