EUROPE MARKETS: French Stocks End Lower After Paris Attack Fuels Election Uncertainty

By Sara Sjolin and Carla Mozee, MarketWatch

Eurozone PMIs rise to 6-year highs and beat forecasts

French stocks closed lower Friday after a suspected terror attack in Paris just ahead of the country's presidential election vote, helping to leave the regional equity benchmark with a loss for the week.

The pan-European Stoxx Europe 600 index finished less than 1 point higher at 378.12, and ended the week lower by 0.7% .

In Paris, the CAC 40 ended down by 0.4% at 5,059.20, the last trading session before Sunday's first round of voting in what's seen as an extraordinarily tight presidential race.

A gunman late Thursday opened fire (http://www.marketwatch.com/story/gunman-slain-after-killing-paris-police-officer- trump-suggests-terrorism-2017-04-20) on the Champs-Élysées boulevard in Paris, killing a police officer and wounding two others. Islamic State claimed responsibility for the suspected terror attack. The attack could give a late- campaign surge in support for anti-immigration, far-right candidate Marine Le Pen, analysts said. Le Pen on Friday urged the government to immediately reinstate French borders (http://www.marketwatch.com/story/le-pen-urges-government-to- immediately-reinstate-french-borders-after-paris-attack-report-2017-04-21) and expel foreigners monitored by surveillance.

Read:When are the French election results out on Sunday? (http://www.marketwatch.com/story/when-are-the-french- election-results-out-on-sunday-2017-04-20)

The CAC 40 on Thursday jumped 1.5%, its biggest jump in seven weeks, as markets started to price in the prospect of a win for centrist presidential candidate Emmanuel Macron.

Le Pen has vowed to hold a referendum on France's membership of the European Union, fueling fears of a breakup of the bloc. One of her three key rivals, far-left euroskeptic Jean Luc Melenchon, has also pledged to renegotiate EU treaties and hold a referendum.

"Last night's terrorist attack in Paris, which given the tightness of the polls, could influence events, leaving investors to face the prospect of a face-off between Marine Le Pen on the right and Melenchon on the left. Any such outcome is unlikely to be well received by the markets," said Michael Hewson, chief market analyst at CMC Markets, in a note.

And: Here's how France's hotly contested election could rattle markets (http://www.marketwatch.com/story/heres-how- frances-hotly-contested-election-could-spark-market-turmoil-2017-04-19)

And:5 charts show what the French presidential election means for financial markets (http://www.marketwatch.com/story/ 5-charts-show-what-the-french-presidential-election-means-for-financial-markets-2017-04-21)

(https://twitter.com/MichelReuters/status/855450649881960450)

Individual benchmarks: Germany's DAX 30 index finished higher by 0.2% at 12,048.57, while the U.K.'s FTSE 100 index shed 0.1% at 7,114.55. (http://www.marketwatch.com/story/ftse-100-wavers-ahead-of-retail-sales-on-course-for-worst- week-in-5-months-2017-04-21)

Economic news: Preliminary readings on April purchasing managers' indexes for the eurozone, France and Germany were all released Friday morning.

All three flash readings for the eurozone--the composite, manufacturing and services PMIs--rose to six-year highs and came in better than forecast, signaling accelerating private-sector activity.

France's preliminary PMIs also beat expectations, with the composite reading jumping to a 71-month high at 57.4.

For Germany, the manufacturing PMI came in slightly better than expected, but the gauge of the services sector missed forecasts.

Movers: Volkswagen AG shares (VOW.XE) fell 0.8% after the German auto maker was ordered to pay a $2.8 billion criminal fine (http://www.marketwatch.com/story/volkswagen-hit-with-28-billion-criminal-fine-2017-04-21)for using equipment used to cheat emissions tests. That formalizes punishment Volkswagen agreed to earlier this year in a plea deal with U.S. prosecutors

Shares of Software AG (SOW.XE) jumped 7.9% after the company reported a smaller-than-expected drop in underlying earnings.

WS Atkins PLC (ATK.LN) rose 6.1% after SNC-Lavalin Group Inc. (SNC.T) said it would buy the U.K. engineering company for GBP2.1 billion ($2.69 billion).

Shares in German soccer club Borussia Dortmund GmbH & Co. KGaA (BVB.XE) added 2.5%. The gain came after police charged a Russian-German man (https://www.wsj.com/articles/dortmund-bomb-suspect-bought-stock-options-on-soccer-attack- 1492758515) with being behind the bomb attack on the Borussia Dortmund team bus last week, alleging he was hoping to make money on a drop in the stock price.


  (END) Dow Jones Newswires
  04-21-17 1243ET
  Copyright (c) 2017 Dow Jones & Company, Inc.

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