France's CAC 40 stock index was seen making steady gains for the rest of the year, shrugging off sovereign debt fears in the eurozone, a Reuters poll found. The CAC 40 was seen at 4,200 points by end-2010, up 6.7 percent from Tuesday's close at 3,938 points, according to the median forecast of around 30 analysts and fund managers. That was down from the 4,300 level forecast in the December poll.
The latest poll also saw the CAC 40 at 4,075 points by mid-year, up 3.5 percent from Tuesday's close but lower than the 4,165 mid-2010 consensus in December. France's blue chip index, in which influential stocks include multinationals such as L'Oreal, Sanofi-Aventis and Total, is up just 0.1 percent so far this year after surging 22 percent in 2009.
Analysts were cautious for the next quarter, expecting debt woes of European countries such as Greece and Spain to weigh on the CAC 40 before things brighten in the second half. "We will see a pick up in mergers and acquisitions deals, capital expenditure will rise, growth in emerging countries will remain strong and the US economy is really turning the corner," said Arnaud Scarpaci, fund manager at Agilis Gestion.
After leading the market rally last year, shares in banks and basic resources companies were seen taking a back seat while investors look for value elsewhere. The fund manager said insurance stocks could also feature among top gainers if it turned out that new solvency rules were not as strict as feared.