(News Bulletin 247) – The Paris Stock Exchange started this week in sharp decline, weighed down by its flagship segment. The CAC 40 lost 1.20% to 7,632.71 points this Monday evening.

Difficult start to the week on the Paris Stock Exchange. The CAC 40 closed down 1.19% at 7,632.71 points, not far from its lowest level of the day at 7,618.73 points.

Political uncertainty dominated the discussions at this first session of the week. In France, negotiations continue to try to form a government after the outcome of the legislative elections. The various left-wing parties failed this weekend to agree on a candidate for the post of Prime Minister.

In the United States, Republican candidate and former President Donald Trump was the victim of an assassination attempt, an episode as tragic as it may be, does not shake the American markets. At the close of the European markets, the main American indices are moving up between 0.7% and 0.9%.

“We believe that the main impact of the attack on the markets will be to put the US elections back at the centre of attention for international investors. Recently, markets have been more concerned about the political situation in France,” notes Greg Hirt of Allianz Global Investors.

In this context, the evolution of the dollar and the yields of American Treasury bonds are particularly scrutinized. The dollar is down 0.3% against the euro, while the yield of the 10-year American Treasury bond is slightly tightening to 4.215% against 4.187% Friday evening.

Kering is the bottom of the CAC 40

Returning to the Paris Stock Exchange, the underperformance of the CAC 40 compared to other major European indices can be explained by the sharp drop in luxury stocks after several setbacks in this sector.

The biggest drop in the CAC 40 on Monday evening was Kering, which fell by 5.3%, LVMH lost 2.7% and Hermès lost 2.6%. The three luxury groups were penalized by disappointing publications from Swatch and Burberry, which respectively fell 9.8% in Zurich and more than 18% in London.

Among small and mid-cap stocks, NFL Biosciences ended down 12.6% despite the announcement of positive results in smoking cessation.

Oil is almost stable, at 85.02 dollars for the August contract on North Sea Brent and at 80.99 dollars for the contract of the same maturity on WTI.