Abstracts » Business

France: no more

Article Abstract:

French stock prices have performed well, but this may not continue, according to BZW. Investors have hoped for looser economic policy, but the government is constrained by the plan for a European single currency, so may not be able to relax either fiscal or monetary policy. Companies could boost earnings growth by restructuring, but they could be hampered by government intervention and limits on their ability to shed jobs. Increased liquidity could help the market, however, following the Balladur bond redemption.

Economic policy

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Stumbling block

Article Abstract:

Morgan Stanley foresees an underperformance for French shares for late 1995. French economic policy objectives are contradictory. Tight monetary and fiscal policy are not compatible with promises on employment. A crisis could lead France to pursue French, rather than European interests. The French market has underperformed in the five years to 1995. New funds are not likely to come from foreign investors, or from domestic investors. There are also concerns over corporate governance and privatization.

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Poll jitters in Paris

Article Abstract:

An election has been called in France by the president, Jacques Chirac. This could affect privatization plans if the government were to change, and companies that could be affected saw a drop in their stock prices following the election announcement. Companies scheduled for privatization include GAN. The socialists do not appear likely to win the election but investors are likely to be wary prior to the election and this is especially true for foreign investors.

Elections

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