Erste Asset Management

Macron wins French elections

Macron wins French elections
Macron wins French elections
(c) iStock
Share post:

The elections are over. The next President of France will be Emmanuel Macron. This strengthens the camp of the liberal EU supporters. What does this result mean for the capital markets?

Cyclical upswing

The elections in France took place against the backdrop of a cyclical upswing in the Eurozone. Experts expect economic growth of 2.1% for 2017 after 1.7% last year. In France, too, numerous economic indicators suggest an acceleration of real economic growth. The economy is expected to grow by 1.4% this year after 1.1% in 2016. This means that France has clearly embarked on a recovery phase. While actual output continues to fall short of potential output, the so-called output gap has been shrinking (last year: almost -2% relative to potential). The immediate risk of deflation has also been overcome. Consumer price inflation is expected to increase from 0.3% to 1.4%.

Structural problems are not going anywhere

However, France continues to grapple with its structural problems. Average growth across the economic cycle and competitiveness are low. Also, government spending (56% of GDP), government debt (almost 100% of GDP), the unemployment rate (10%), and the degree of regulation are high. With Macron’s victory, at least the potential for structural reforms and economically agreeable measures in France has increased.

Parliamentary elections as hurdle

The next hurdle Macron has to clear are the parliamentary elections in France on 11 and 18 June. It is questionable whether Macron’s new movement can achieve a majority. And if it cannot do so, the different parties have to find a way of hammering out a sustainable, reform-friendly labour programme.

EU strengthened

Mr. Macron is a declared EU supporter. The probability of the long, dogged integration process in the European Union and the Eurozone and of the efforts to put these associations on a self-supporting, sustainable basis continuing has increased. This includes the expansion of the joint institutions for concerted economic and financial policies and the addressing of the deficit of legitimisation of the European Union.

Anti-globalisation wave warded off only temporarily

After the Brexit vote and Donald Trump’s election as US President, the big anti-globalisation wave has been stopped – for the time being. The next cyclical downturn will come at some point, and the parliamentary elections in France could lead to a political standstill, which would intensify the structural problems in France. As a result, this situation would slightly tarnish the glimmer of hope for a long-term functioning EU. All of that would ultimately lend further support to the nationalist forces.


The combination of good economic indicators, a decrease in concerns over a possible break-up of the European Union, and hopes for reforms in France and the EU is positive for risky assets such as equities.


Legal disclaimer

This document is an advertisement. Unless indicated otherwise, source: Erste Asset Management GmbH. The language of communication of the sales offices is German and the languages of communication of the Management Company also include English.

The prospectus for UCITS funds (including any amendments) is prepared and published in accordance with the provisions of the InvFG 2011 as amended. Information for Investors pursuant to § 21 AIFMG is prepared for the alternative investment funds (AIF) administered by Erste Asset Management GmbH pursuant to the provisions of the AIFMG in conjunction with the InvFG 2011.

The currently valid versions of the prospectus, the Information for Investors pursuant to § 21 AIFMG, and the key information document can be found on the website under “Mandatory publications” and can be obtained free of charge by interested investors at the offices of the Management Company and at the offices of the depositary bank. The exact date of the most recent publication of the prospectus, the languages in which the key information document is available, and any other locations where the documents can be obtained are indicated on the website A summary of the investor rights is available in German and English on the website and can also be obtained from the Management Company.

The Management Company can decide to suspend the provisions it has taken for the sale of unit certificates in other countries in accordance with the regulatory requirements.

Note: You are about to purchase a product that may be difficult to understand. We recommend that you read the indicated fund documents before making an investment decision. In addition to the locations listed above, you can obtain these documents free of charge at the offices of the referring Sparkassen bank and the offices of Erste Bank der oesterreichischen Sparkassen AG. You can also access these documents electronically at

N.B.: The performance scenarios listed in the key information document are based on a calculation method that is specified in an EU regulation. The future market development cannot be accurately predicted. The depicted performance scenarios merely present potential earnings, but are based on the earnings in the recent past. The actual earnings may be lower than indicated. Our analyses and conclusions are general in nature and do not take into account the individual characteristics of our investors in terms of earnings, taxation, experience and knowledge, investment objective, financial position, capacity for loss, and risk tolerance.

Please note: Past performance is not a reliable indicator of the future performance of a fund. Investments in securities entail risks in addition to the opportunities presented here. The value of units and their earnings can rise and fall. Changes in exchange rates can also have a positive or negative effect on the value of an investment. For this reason, you may receive less than your originally invested amount when you redeem your units. Persons who are interested in purchasing units in investment funds are advised to read the current fund prospectus(es) and the Information for Investors pursuant to § 21 AIFMG, especially the risk notices they contain, before making an investment decision. If the fund currency is different than the investor’s home currency, changes in the relevant exchange rate can positively or negatively influence the value of the investment and the amount of the costs associated with the fund in the home currency.

We are not permitted to directly or indirectly offer, sell, transfer, or deliver this financial product to natural or legal persons whose place of residence or domicile is located in a country where this is legally prohibited. In this case, we may not provide any product information, either.

Please consult the corresponding information in the fund prospectus and the Information for Investors pursuant to § 21 AIFMG for restrictions on the sale of the fund to American or Russian citizens.

It is expressly noted that this communication does not provide any investment recommendations, but only expresses our current market assessment. Thus, this communication is not a substitute for investment advice, does not take into account the legal regulations aimed at promoting the independence of financial analyses, and is not subject to a prohibition on trading following the distribution of financial analyses.

This document does not represent a sales activity of the Management Company and therefore may not be construed as an offer for the purchase or sale of financial or investment instruments.

Erste Asset Management GmbH is affiliated with the referring Sparkassen banks and Erste Bank.

Please also read the “Information about us and our securities services” published by your bank.

Subject to misprints and errors.

Leave a comment Required fields are marked with *

Your email address will not be published. Required fields are marked *