Markets outlook: European shares downbeat over French predictions

The Eiffel Tower is pictured from the top of the Arc de Triomphe, Monday, Feb. 12, 2024 in Paris. (AP Photo/Aurelien Morissard)
The Eiffel Tower is pictured from the top of the Arc de Triomphe, Monday, Feb. 12, 2024 in Paris. (AP Photo/Aurelien Morissard) Copyright Aurelien Morissard/Copyright 2024 The AP. All rights reserved.
By Indrabati Lahiri
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The French government's predictions for lower economic growth in 2024 put an early dampener on the mood of the markets.

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European shares were fairly downbeat on Monday morning, following French stocks being particularly downcast due to the French government cutting the country's economic growth for 2024.

France's gross domestic product (GDP) outlook was slashed from 1.4% to 1% for the year, due to the ongoing damage caused by the Russia-Ukraine war as well as reduced trade with China and Germany.

The CAC 40 index dropped 0.43% to 7,734.6, whereas the Stoxx 600 index was mostly flat at 491.6. Conversely, the FTSE 100 index was up 0.41% to 7,724.8.

Banking stocks shine, IT and steel stocks amongst stragglers

Credit Agricole was one of the top gainers on the CAC 40 on Monday, inching up 0.2% to €12.3, following the bank's fourth quarter 2023 profits recently beating analyst estimates.

BNP Paribas rose 0.4% to €54.7, after the company recently revealed it would now achieve a 12% return on tangible equity in 2026, instead of 2025. The bank has also been facing an exodus of traders due to them anticipating a disappointing bonus season.

Thales was one of the main losers on Monday, dropping 3.83% on Monday to €135.6. The company was recently chosen by Air India to provide in-flight entertainment for its widebody aircrafts.

ArcelorMittal dipped 2.61% to €24.9, following the company's biggest Italian steel mill being embroiled in a special administration issue with the Italian government.

What to watch in the week ahead

Investors are also looking ahead to the Turkish and Euro Area consumer confidence on Wednesday, as well as the European Central Bank Non-Monetary Policy Meeting on the same day.

The US FOMC minutes for its January meeting will also be released on Wednesday.

France's business confidence index, as well as business climate indicator will be out on Thursday, as well as a slew of purchasing managers' index (PMI) data from Germany, the Euro Area and the UK.

The Euro Area and Italian inflation reports for January will also be out on Thursday. Friday will see the UK consumer confidence report for February, as well as German GDP numbers for Q4 2023.

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