French stocks at threemonth lows
Fed policy outcome due later this week
Aviva dips after JPM downgrade

June 10 Reuters European stocks dropped on Monday after French President Emmanuel Macron called a snap election following a heavy loss in the European Union vote to the farright, rattling investors already worried about the interest rate outlook.

France39;s bluechip CAC 40 index dropped 1.8 to touch a more than threemonth low, with lenders, including BNP Paribas, Societe Generale and Credit Agricole, falling in the range of 4.3 and 7.

The CAC 40 looked on course for its biggest percentage daily drop since July 2023.

French bond prices also fell , pushing yields to their highest in two weeks, after Eurosceptic nationalists made gains in European Parliament elections on Sunday, prompting a bruised Macron to call a snap national election.

What we39;ve seen before when there were other kinds of political gambles, not least for the Brexit referendum in the UK, is that you never necessarily could be sure which way the electorate will sway, said Susannah Streeter, head of money and markets at Hargreaves Lansdown.

Given that there have been shocks in the past, there are some concerns that this gamble may not pay off for Macron, Streeter said.

Macron called a parliamentary election with the first round on June 30. If the farright National Rally party wins a majority, Macron would be left without a say in domestic affairs.

The panEuropean STOXX 600 index fell 0.6,…