French assets fell along with the euro on Monday after newly appointed Prime Minister Sébastien Lecornu resigned amid growing pressure from left-wing MPs over his budget plans, plunging the eurozone's second-largest economy deeper into crisis. This was reported by Reuters, writes UNN.
Details
The agency writes that this wiped millions of dollars off the stock markets and increased uncertainty about the eurozone's second-largest economy.
Prime Minister Sébastien Lecornu unexpectedly submitted his resignation to President Emmanuel Macron just hours after the cabinet was announced — making him the shortest-serving in modern French history.
The Paris CAC 40 index, with a volume of about $3 trillion, fell by more than 1.5%, becoming the worst index in Europe.
Shares of major banks collapsed: BNP Paribas, Societe Generale, and Crédit Agricole lost 4-5%.
The euro, which had so far withstood most of the political turmoil in France over the past year, fell by 0.7% to $1.1665.
"It's alarming that the new cabinet lasted only 12 hours," said Danske Bank analyst Kirstine Kunjby-Nielsen. "It seems there is no willingness in parliament to pass the budget, so I think yields will go up and the euro/dollar pair will remain under pressure in the short term."
Mid-cap French stocks also suffered — the index fell by 2.6% and is heading for its largest daily decline since April. Other European markets were also affected: the broad STOXX 600 fell by 0.3%, and the German DAX was slightly weaker.
Recall
French Prime Minister Sébastien Lecornu submitted his resignation to President Emmanuel Macron, which the head of state accepted. This happened after the first round of appointments to the new government caused anger among the opposition and other politicians.