European stocks set for weekly gains; focus on the French elections

The DAX chart of the German stock price index is pictured on the stock exchange in Frankfurt, Germany, April 5, 2022. REUTERS/Staff

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  • The STOXX 600 is expected to end the week up around 0.6%
  • Banco BPM jumps after Crédit Agricole reveals its stake
  • The CAC 40 underperforms this week
  • Le Pen closes gap with Macron ahead of Sunday’s election

April 8 (Reuters) – European stocks rallied on Friday to erase weekly losses as investors focused on a close race between far-right rival Marine Le Pen and incumbent President Emmanuel Macron as they approached of the first round of the French presidential elections this weekend.

Financials (.SX7P) and materials stocks (.SXEP), (.SXPP) led the gains with all major sectors in positive territory. The pan-European STOXX 600 index (.STOXX) gained 1.1% and is now expected to end the week about 0.6% higher.

Topping the index was a 14.1% rise in Banco BPM (BAMI.MI), after French bank Credit Agricole (CAGR.PA) announced it had bought a 9.2% stake in the third Italian bank. Read more

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“European markets have mostly been catching up with the US since yesterday’s close,” said Julien Lafargue, chief market strategist at Barclays Private Bank, adding that investors are waiting to get an idea of ​​what the markets might look like. profits with major US banks ready to go. leave next week.

“The mood among investors is not very optimistic these days. As long as earnings are decent, we could see some positive surprises as a result of this.”

Despite rebounding 12% from one-year lows hit in March, the STOXX 600 index is still down more than 6% this year on fears that the inflation spike due to the war in Ukraine could triggers central bank movements that could weigh on growth.

“Europe was already not really the best place because of what is happening in Ukraine. It is going to be difficult for Europe to significantly outperform until we have clarity. The month and upcoming half will be quite important for Europe,” Lafargue said. .

In Sunday’s first round of elections in France, Macron is seen winning, but his rival Marine Le Pen has surged in the polls in recent weeks, leaving her victory within the margins of error. The two leading candidates in the vote will head to a run-off on April 24. read more

Barclay’s Lafargue said that despite the polls, turnout or lack thereof could swing the election.

France’s CAC 40 index (.FCHI) rose 1.8%, but fell around 1.7% this week – the most among its European peers – due to election uncertainty.

Among other stocks, Atlantia (ATL.MI) rebounded 3.7% after a report that major shareholders Edizione and Blackstone (BX.N) could launch an offer for the Italian infrastructure group at 24 euros per share towards Easter. Read more

Telecom Italia (TLIT.MI) fell 1.0% after rejecting a 10.8 billion euro ($11.8 billion) offer from KKR (KKR.N). Read more

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Reporting by Susan Mathew in Bengaluru; Editing by Krishna Chandra Eluri and Arun Koyyur

Our standards: The Thomson Reuters Trust Principles.

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