European stocks falter after Macron's victory confirmed

European stock markets gave up some recent gains today after Emmanuel Macron comfortably won the French presidential election. Over the past couple of weeks, European stocks, particularly French ones, had been buoyant on expectations of a Macron victory over the far-right candidate Marine Le Pen.
In Europe, the CAC 40 index in Paris was down 0.9 per cent at 5,385 while Germany's DAX fell 0.3 per cent to 12,685. The FTSE 100 index of leading British shares bucked the trend, trading 0.1 per cent higher at 7,307. Wall Street was poised for a lower opening, with Dow futures and the broader S&P 500 futures down 0.1 per cent.

When Macron topped the first round of voting in the French presidential election two weeks ago, French stocks soared to near-decade highs. Today, the reaction to his clear victory in the runoff was subdued: investors had been fully expecting it and seem wary of the difficulties he'll face governing a divided country.
The clear bias in favour of Macron in the markets over Le Pen rests on a number of factors, above all his views on Europe. Macron is a keen advocate of the European Union and the euro currency, while Le Pen has proposed taking France out of both.

"It's been a lively start to trading today, with the initial relief rally following Emmanuel Macron's victory in the French election quickly fizzling out as the euro and European stock markets reversed gains to trade lower on the day," said Craig Erlam, senior market analyst at OANDA. "What we're seeing this morning is a classic case of the rumour or the expected result in this case being bought and the fact being sold."
After initially rallying to six-month highs above $1.10 in the wake of the Macron result, the euro faltered and was trading 0.5 per cent lower at $1.0945.

Earlier, Asian stock markets, which were the first to respond to the Macron win, rallied. Japan's benchmark Nikkei 225 added 2.3 per cent to finish at 19,895.70 and South Korea's Kospi index hit a record high ahead of a presidential election tomorrow, gaining 2.3 per cent to 2,292.76. Australia's S&P/ASX 200 gained 0.6 per cent to 5,870.90 and Hong Kong's Hang Seng gained 0.3 per cent to 24,547.98. The Shanghai Composite lost 0.8 per cent to 3,078.61 on weaker than expected trade data for April. In currency markets, the dollar was down 0.1 per cent at 112.59 yen.
Benchmark New York crude was steady at USD 46.22 a barrel while Brent, the international standard, fell 0.1 per cent to USD 49.06 a barrel.