Piazza Affari is down sharply at the end of the morning amid weak European stock markets, infected by investor nervousness over the political uncertainty in France ahead of the early elections announced as a surprise by Emmanuel Macron after his defeat in the European elections.

Paris loses more than 2 percent with major banks registering declines of up to more than 5 percent, while French government bond yields are heading for the biggest weekly jump, more than 20 basis points, since the euro debt crisis, according to Lseg data. The end-of-month vote in France will also be crucial in understanding the political balance in Europe.

The Italian stock index, in particular, is paying for its strong exposure to the banking sector, as well as the market's hypersensitivity to spread trends on domestic debt. After falling more than 2 percent yesterday, around 12:40 p.m. the Ftse Mib lost 2.7 percent with intense volumes near 1.4 billion euros. Heavy is the balance since the beginning of the week, that is, since the European vote, currently around -4.8%.

US index futures are also down.

Among the headlines:

Banks index loses 4%. Intesa Sanpaolo gives up 3.4 percent, UniCredit 4.5 percent, Bper and Mps 4.6 percent. The last three came to lose around 5 percent.

"Italian banks are falling because they are infected by the weakness of French banks and because of the widening spread," says one trader. The yield spread between Italy and Germany rose to 157 points from 148 at yesterday's close.

Also down is the auto sector (-2.6 percent), which is also under pressure in the rest of Europe due to fears of retaliation after duties announced in recent days by the EU on electric car imports from China. Stellantis loses more than 3%.

Sales also hit other industrials and luxury goods.

Among the very few plus signs were the defensive Amplifon (+1.8%) and Campari (+0.41%). Saipem does well, while the rest of the energy sector succumbs to the general negative intonation.

(Claudia Cristoferi, editing Stefano Bernabei)