Far-right gains in EU Parliament result in sharp losses for European stocks and euro

European stock markets and the euro fell due to political uncertainty after far-right gains in EU Parliament elections, leading to early elections in France. French President Macron's decision to call new legislative elections raised concerns about the country's finances. Moody's warned of a potential credit score downgrade for France. The growing spread between French and German bond yields indicated fading confidence in Paris's fiscal prospects. In the US, expectations of slower rate cuts by the Fed emerged, impacting market sentiment. The euro and French markets were affected by Macron's snap election decision. The possibility of a hostile parliament could hinder Macron's policy agenda and fiscal deficit reduction efforts. The widening gap between German and French bond yields raised investor risk concerns. Far-right parties' success in EU elections caused political turmoil in Europe, with France, Italy, and Austria seeing victories. Investors awaited key economic reports for insights into future Fed actions. Market analysts observed mixed expectations regarding potential rate cuts in the US.