French stocks rebounded on Monday following a steep decline last week, triggered by concerns that a new government might worsen the country's fiscal outlook and jeopardize the stability of the euro zone.
French government bonds experienced some relief after Marine Le Pen, leader of the far-right in France, stated her willingness to cooperate with President Emmanuel Macron if she emerges victorious in the upcoming snap parliamentary election, set to begin later this month.
Meanwhile, policymakers at the European Central Bank reportedly indicated that they have no plans to initiate emergency purchases of French bonds to stabilize the market.
The benchmark CAC 40 index gained 13 points, or 0.2 percent, closing at 7,516. This follows a significant loss of over 6 percent last week due to the political uncertainties within the country.
Shares of China-linked companies such as Hermes, LVMH, and Kering declined. This movement came after recent Chinese economic data indicated the nation's recovery is still uneven, and the People's Bank of China (PBOC) decided to keep a key policy rate unchanged. This decision disappointed some market participants who had anticipated a rate cut following unexpectedly weak bank lending numbers.
