The political turmoil in France leading the country to lose its position as the largest market shares in Europe, less than two years after stealing that title from the United Kingdom, according to a Bloomberg report.
President Emmanuel Macron’s surprise announcement of early French elections (June 30-July 7) triggered a slide that wiped about $258 billion from the market capitalization of French companies last week. Shares in banks Societe Generale SA, BNP Paribas SA and Credit Agricole SA – all major holders of government debt – lost more than 10% each.
The country’s stocks are now worth a total of about 3.13 trillion. dollars, almost beaten by the United Kingdom with 3.18 trillion. dollars, according to data compiled by Bloomberg. The CAC 40 erased all of its gains for 2024 — a sharp reversal from a record high a month earlier.
“We are in a period where there is no certainty in three to four weeks and the market may unfortunately become more volatile,” said Alberto Tocchio, portfolio manager at Kairos Partners.
At the same time, a combination of factors, including improving global growth and a pick-up in merger activity, has made UK shares popular with investors again. Even as the country prepares for its own general election, the result is seen as stronger with the opposition Labor Party leading the polls by a wide margin.