The Paris stock market is down 0.4% this morning, around 7520 points, penalized by Michelin and Eurofins Scientific (-3.8%) and Stellantis (-2.7%).

Scalded by the results of the European elections at the beginning of June and the announcement of the dissolution of the French National Assembly, investors are beginning to calmly integrate the scenario of a paralyzed political environment in France.

It's highly likely that the technical rebound seen yesterday will run out of steam, as there are no motors to sustain it", warns Christopher Dembik, Investment Strategy Advisor at Pictet AM.

We think that the political risk in France will definitely take a back seat on the stock market - unless there is a surprise in the polls", he adds.

After the jolt caused by the French vote, market participants are hoping to regain their composure over the next few sessions, particularly as questions about the economic situation return to the forefront.

The market correction and the adjustment of valuations should shift the focus back to fundamentals, primarily inflation.

Investors have just learned of the eurozone's annual inflation rate. This is estimated at 2.5% in June 2024, compared with 2.6% in May, according to a flash estimate published by Eurostat, the European Union's statistical office.

German inflation figures, published a little earlier, came in slightly above consensus, while moving closer to the ECB's 2% target, giving traders hope of pleasant surprises.

On the bond front, the 10-year bund is trading at 2.59%, while the French OAT is at 3.36%, a spread of 77 points.

Professionals will also be counting on a promising crop of second-quarter results, starting next week, to bring market fundamentals back to the fore and restore the upward trend that has characterized stock markets since the beginning of the year.

In French company news, Sodexo reports sales for its third accounting quarter of 6.07 billion euros, up 5.6% year-on-year, including a negative currency effect of -0.2% and a contribution from acquisitions net of disposals of -1%.

Thales announces the inauguration of an assembly line to quintuple production of 70mm laser-guided rockets at its Herstal site in Belgium, in order to help strengthen the ammunition capabilities of Europe's armed forces.

Vinci announces that Nuvia, a Vinci Construction subsidiary specializing in nuclear projects and services, has finalized the acquisition of MBO Groupe, a major player in insulation, scaffolding and structural containment in France.

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