France faces a pivotal confidence vote that could shake up the CAC 40 and broader European markets. We break down the political crisis, market risks, and actionable trading scenarios with technical levels.
Big news is breaking out of France as Prime Minister François Bayrou faces a crucial confidence vote, with major implications for the CAC 40 index and the euro. Political uncertainty is at its peak after the 2024 snap election left France with a hung parliament—no party holds a clear majority, and the far-right National Rally is now the largest single party, while a left-wing coalition forms the largest bloc but cannot govern alone.
What’s at stake?
Bayrou is widely expected to lose the vote, which would collapse the government and deepen France’s political paralysis. President Macron is unlikely to call another snap election; instead, he may try to appoint a new, centrist prime minister to form a workable coalition and pass a budget.
The index has already dropped from the 8,000 psychological level to around 7,650, forming a short-term double bottom. First bearish target below is the key support of 7,500, with longer-term implications exposing the 7,000 handle if the government collapses, there is a deadlock, or another possible Fitch downgrade (due on 12 Sep).
The bullish scenario above 7,600 brings into focus the 7,775 and subsequently the 8,000 round resistance if a stable coalition or credible budget announcement leads to a relief rally. However, if political paralysis continues or if a far-left or far-right coalition gains influence, expect further downside regardless.
Watch for sharp moves in the CAC 40 and euro, with key levels at 7,650 (support), 7,500 (bearish target), and 8,000 (bullish target).
This content is not directed to residents of the EU or UK. Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.
Big news is breaking out of France as Prime Minister François Bayrou faces a crucial confidence vote, with major implications for the CAC 40 index and the euro. Political uncertainty is at its peak after the 2024 snap election left France with a hung parliament—no party holds a clear majority, and the far-right National Rally is now the largest single party, while a left-wing coalition forms the largest bloc but cannot govern alone.
What’s at stake?
Bayrou is widely expected to lose the vote, which would collapse the government and deepen France’s political paralysis. President Macron is unlikely to call another snap election; instead, he may try to appoint a new, centrist prime minister to form a workable coalition and pass a budget.
The index has already dropped from the 8,000 psychological level to around 7,650, forming a short-term double bottom. First bearish target below is the key support of 7,500, with longer-term implications exposing the 7,000 handle if the government collapses, there is a deadlock, or another possible Fitch downgrade (due on 12 Sep).
The bullish scenario above 7,600 brings into focus the 7,775 and subsequently the 8,000 round resistance if a stable coalition or credible budget announcement leads to a relief rally. However, if political paralysis continues or if a far-left or far-right coalition gains influence, expect further downside regardless.
Watch for sharp moves in the CAC 40 and euro, with key levels at 7,650 (support), 7,500 (bearish target), and 8,000 (bullish target).
This content is not directed to residents of the EU or UK. Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.
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Pernyataan Penyangkalan
Informasi dan publikasi tidak dimaksudkan untuk menjadi, dan bukan merupakan saran keuangan, investasi, perdagangan, atau rekomendasi lainnya yang diberikan atau didukung oleh TradingView. Baca selengkapnya di Persyaratan Penggunaan.