FTDS - What Does France's Election Mean For Markets?
2024-07-04 12:30:00 ET
Summary
- The French election: I discuss the investment implications of three possible scenarios: a far-right majority, a far-left majority, and a temporary administrative solution.
- We received two important data points that could bring us closer to the long-awaited start of Federal Reserve rate cuts.
- I recap the first half’s market results, which was a strong period for most risk assets.
July 1 marked the beginning of the second half of 2024, and while “New Half-Year’s Day” may not be an official holiday, it feels like the starting point of some new regimes. We got two important data points last week that I believe should bring us closer to the long-awaited start of Federal Reserve (Fed) rate cuts.
The first round of legislative elections took place in France on June 30, with exit polls/initial results indicating that Marine Le Pen’s far-right National Rally party and allies gained the most votes. And, British voters are expected to usher in a Labour government after 14 years under Tory rule.
Can the strengths of the first half continue?
Let’s start by taking a moment to recap the first six months of the year. It was a strong period for most risk assets. Global equities, as represented by the MSCI World Index, posted double-digit gains for the first half of the year. 1 The standout was the US, with the S&P 500 Index gaining about 15% during the period. 2 Other major stock indices also experienced gains, but they were more modest....
What Does France's Election Mean For Markets?