Stock market today: French stocks jump as far-right party takes lead in first round of elections | WWTI

Stocks rose in Europe on Monday, with the benchmark index in Paris rising 2.8% shortly after the far-right National Rally took a strong lead in the first round of legislative elections.

Other European markets opened higher, while most Asian markets also advanced.

The euro rose from $1.0744 to $1.0771 as pollsters suggested the National Rally could win a majority in the lower house of Parliament. However, the outcome remains uncertain and the electoral system is complex.

The CAC 40 in Paris fell and was trading up 1.6% at 7,594.08, while Germany's DAX rose 0.5% to 18,320.36. In London, the FTSE 100 rose 0.5% to 8,203.40.

The euro's gains were likely due to relief that far-right parties did not gain more votes than expected, economists at ING Economics said in a commentary.

Yet the first-round results do not offer much certainty about the composition of parliament, and the runoff scheduled for next weekend is actually the riskier event, they said.

In Asian trading, Japan's benchmark Nikkei 225 index gained 0.1% to 39,631.06 after a quarterly survey by the Bank of Japan, called tankan, showed a modest improvement in confidence among the country's biggest manufacturers in April-June.

However, the government revised down its growth estimate for the first quarter of the year to an annual rate of minus 2.9%, from a previous figure of minus 1.8%.

Across all sectors and company sizes, business conditions remained stable at 12, consistent with past form with (quarterly) GDP growth of around 0%, said Marcel Thieliant of Capital Economics when evaluating the tankan. A further slowdown in GDP growth this quarter would be consistent with the fall in industrial production that businesses were forecasting for June.

The dollar gained further against the Japanese yen and was trading early Monday at 161.04 yen, compared with 160.80 yen late Friday.

The Shanghai Composite Index climbed 0.9 percent to 2,994.73 after a survey of factory purchasing managers released over the weekend showed conditions remained in contraction for a second straight month.

But a similar survey of private sector manufacturing activity, released Monday, showed an improving business situation. Caixin's manufacturing PMI reached 51.8 in June on a scale of up to 100, up from 51.7 the previous month. Values ​​above 50 are considered to indicate expansion.

Hong Kong markets were closed for a public holiday.

Australia's S&P/ASX 200 fell 0.2% to 7,750.70. South Korea's Kospi edged up 0.2% to 2,804.31 after a private sector survey showed South Korean factory activity was the best since April 2022.

A wave of late-day selling sent the S&P 500 down 0.4% on Friday, putting it in the red for the week. The Nasdaq Composite fell 0.7%, while the Dow Jones Industrial Average slipped 0.1%.

Despite a gloomy end to the season, the S&P 500 and the Nasdaq remain close to their historic highs.

The S&P 500 Index gained 3.5% in June and is up about 14.5% year to date. The Nasdaq gained about 6% for the month and is up 18.1% this year.

Report shows inflation continues to fall. Investors are hoping the slowdown will prompt the Federal Reserve to start cutting interest rates, which remain at their highest level in more than 20 years.

According to the latest Personal Consumption Expenditure (PCE) index, consumer prices rose 2.6% in May from a year earlier. This figure marks a continued decline from the 2.7% level recorded in April and is significantly lower than the peak of 7.1% recorded two years ago.

The Fed has kept interest rates at their highest level in more than two decades in an effort to bring inflation back to its 2% target. Other measures of inflation, including the popular Consumer Price Index, have also shown that price pressures are easing.

In other trading, benchmark U.S. crude rose 45 cents to $81.99 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, added 43 cents to $85.43 a barrel.