Leftist coalition secures victory in France

Markets react to an unexpected victory by a left-wing coalition in France’s legislative election.

By Nadia Elbilassy | @Nadia Elbilassy | 8 July 2024

Market open
  • The euro remained stable after a leftist coalition won the most parliamentary seats with Macron's party second and Le Pen's far-right party third.

  • French political future is uncertain as no single party has a dominant presence in parliament.

  • Traders focus on Powell's 2-day testimony and US CPI numbers for signs of policy easing amid a weakening US economy.

The euro remained stable following the results of the French election, which revealed that a leftist coalition secured the highest number of parliamentary seats. President Emmanuel Macron's party came in second, while Marine Le Pen's far-right party took third place.

The future of French politics is now unclear, as the election results indicate that no single party has a dominant presence in parliament.

European equity futures declined alongside Asian shares, due to concerns about France's post-election finances.

Focus this week will fall on the 2-day testimony by Powell and CPI numbers from the US. Traders will be closely watching for signs that policy easing may begin as early as September, especially given the latest jobs report indicating a weakening US economy.

Earnings reports from major US banks, including JPMorgan Chase & Co., are also due.

Gold prices continued to rise, hovering near $2,378 after softer NFP data sparked rate cut expectations in September.