Global Markets
French bonds sell off as weekend protests deepen fiscal worries
France's 10-year yield jumped about 7 basis points and the CAC 40 fell more than 1%.
HedgeWeekly News Desk ·
French government bonds sold off on Monday after violent demonstrations across the country over the weekend added to concerns about its finances. The 10-year yield rose about 7 basis points to 4.86%, while the German equivalent climbed less than 2 basis points to 3.43%, widening the gap between the two.
The CAC 40 fell more than 1%, and the large French banks were among the worst performers, with BNP Paribas, Société Générale and Crédit Agricole down between 2.2% and 2.6%. The broader STOXX Europe 600 slipped about 0.7% in early trade, and the euro fell 0.3% to around $1.12, close to last week's 16-month low.
Unrest makes it harder for Paris to cut spending or raise taxes, and wider spreads raise the cost of financing its deficit. For US investors, a weaker euro and rising European yields add to the pressure on global bond markets.