A French flag is seen on the Place de la Republique as people celebrate after the Nouveau Front Populaire, an alliance of left wing parties including the far-left wing party, La France Insoumise came in first on July 07, 2024 in Paris, France.
Remon Haazen | Getty Images News | Getty Images
LONDON — European stocks were trading slightly higher during early hours on Wednesday, as investors braced for an upcoming no-confidence vote in France’s parliament, the National Assembly.
The French CAC 40 index gained 0.3% shortly after the start of European trade, as investors awaited the latest developments in a week of political upheaval in France.
French lawmakers are expected to vote on the future of Prime Minister Michel Barnier’s minority government this evening, with the motions coming after Barnier used special constitutional powers on Monday to pass a contested budget bill without a parliamentary vote.
The rightwing National Rally party has said it will support the motion brought by its left-wing rivals, but will also support its own motion of no-confidence. It’s highly likely that Barnier’s government will collapse after the vote.
The autos sector led gains on the Stoxx 600 index, adding close to 1% amid a report from Italian newspaper Corriere della Sera that Stellantis is eyeing outgoing Apple Chief Financial Officer Luca Maestri for the post of the carmaker’s new CEO. Healthcare, food and beverage and basic resources stocks were in negative territory.
In other news, political upheaval in South Korea is being closely-watched by investors in the Asia-Pacific region. Overnight, South Korean markets opened lower after President Yoon Suk Yeol’s surprise decision to impose and then lift a martial law decree within hours.
A coalition of lawmakers from opposition parties are planning to propose a bill to impeach Yoon on Wednesday, which should be voted within 72 hours if introduced, according to Reuters. Yoon’s chief of staff and senior secretaries have reportedly offered to resign en masse.
— CNBC’s Dylan Butts contributed to this market summary.
