Major stocks closed higher on Monday as investors closely watching the results of France's parliamentary election, and U.S. stocks also gained on the day.
The British FTSE 100 Index closed at 8,166.76 points, up 2.64 points, or 0.03 percent. The Paris CAC 40 closed at 7,561.13 points, up 81.73 points, or 1.09 percent. Germany' DAX Index closed at 18,290.66 points, up 55.21 points, or 0.30 percent.
Investors are paying close attention to the French parliamentary elections. The first round of voting ended on Sunday night, with no party gaining a majority of the votes. The second round of the elections, set for July 7, will decide how many deputies each political camp will have in the National Assembly.
According to predictions made by analysts, it is very likely that no single party will win at least 289 of the 577 seats in the National Assembly to secure an outright majority, which may lead to the situation of "co-governance by the left and right wings".
Such a situation is interpreted by the market as "the least worst" option. According to the current tax and expenditure propositions of the far-right and left-wing alliances, an outright victory for either could trigger a severe market shock that could turn into a debt crisis. Given these factors, "co-governance" is regarded as more likely to pursue tax and immigration policies that are closer to the status quo. The French stock market has risen sharply due to this.
U.S. stocks ended higher on Monday.
The Dow Jones Industrial Average rose 50.66 points, or 0.13 percent, to 39,169.52. The S and P 500 added 14.61 points, or 0.27 percent, to 5,475.09. The Nasdaq Composite Index increased by 146.70 points, or 0.83 percent, to 17,879.3.
Six of the 11 primary S and P 500 sectors ended in red, with materials and industrials leading the laggards by losing 1.55 percent and 1.10 percent, respectively. Meanwhile, technology and consumer discretionary led the gainers by rising 1.30 percent and 0.73 percent, respectively.
The U.S. manufacturing purchasing managers' index (PMI) came in at 48.50, down from 48.70 last month, according to the latest data released on Monday by the Institute for Supply Management (ISM). The index has shrunk for three consecutive months.
Oil prices advanced on Monday. The West Texas Intermediate for August delivery added 1.84 U.S. dollars, or 2.26 percent, to settle at 83.38 dollars a barrel on the New York Mercantile Exchange. Brent crude for September delivery went up 1.60 dollars, or 1.88 percent, to settle at 86.6 dollars a barrel on the London ICE Futures Exchange.
Analysts said that the unrest in the Middle East and the expectation of rising fuel demand in the U.S. in the summer season are the major factors that pull up the oil prices.
Major stock indexes in Europe, US close higher Monday
Major stock indexes in Europe, US close higher Monday
