A liquidation in Europe set the tone for the markets world on Monday, since the president’s decision Emmanuel Macron to advance the legislative elections in France weighed, above all, from the euro to bank stocks and government bonds.
He euro was trading at one-month lows against the dollarEuropean stock markets lost 0.6%, euro zone banking securities fell 2% and the yield of the public debt in France and Italy it skyrocketed.
For now, it is the prospect of a new political uncertainty in the second largest economy in the Euro zone the one that weighs on confidence after the advances of extreme right in the elections to European Parliament on Sunday will lead a bruised Macron to call early national elections.
Asian papers, excluding Japanfell and US stock futures pointed to a weak opening in Wall Streetwith an eventful week ahead that includes the release of data from inflation in USAas well as meetings of the Federal Reserve (Fed) and the Bank of Japan.
“The news from France have generated a risk premium around European assets,” said Mark Dowding of BlueBay Asset Management. “It could swing a little more, but we have to remember that this is a parliamentary election, not a presidential one,” she added.
The French bank Societe Generale plummeted more than 7% and BNP Paribasalmost 5%, as investors fear that their financing costs will increase if the sovereign debt French becomes more expensive amid higher spending, bankers said.
The yield on 10-year French public debt rose almost 10 basis points to 3.21%, while the cost of Italian borrowing also rose.
In Asia, activity was sparse as Australia, China, Hong Kong and Taiwan celebrated holidays. The broadest index of MSCI Asia-Pacific stocks excluding Japan fell 0.4%, global stocks fell 0.2% and U.S. stock futures also fell.
The Federal Reserve’s next monetary policy decision will be announced on Wednesday and just before May inflation figures in the United States will be published.
The performance of the US treasury bondswhich moves inversely to prices, improved, reflecting the expectations of long-term rate hikes. The return on two- and 10-year notes advanced more than 2 basis points each, to 4.89% and 4.46%, respectively.
In raw materials, prices Petroleum rose a little more than 10 cents, while the gold spot rose 0.25%, around $2,298 per ounce.
Source: Ambito
