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FACTBOX: Impact of Sarkozy's election pledges on French stocks
PARIS (Reuters) - Here are some of the main proposals of right-wing presidential candidate Nicolas Sarkozy and the stocks analysts say could be impacted if he won the French presidential elections.
- A single more flexible labor contract; lower social charges and corporate tax;
POSITIVE IMPACT: Companies with high labor and fixed costs such as carmakers Peugeot and Renault, tire manufacturer Michelin.
NEGATIVE IMPACT: Temporary staffing companies such as Switzerland's Adecco and Dutch group Vedior, which make over a third of their sales in France.
- Lower value added tax rate on food services to 5.5 percent from 19.6 percent currently.
POSITIVE IMPACT: Food group Danone and caterer Sodexho.
- Allow all stores to open on Sundays.
POSITIVE IMPACT: Retail stocks such as lingerie and womenswear retailer Etam, home improvements retailers Mr Bricolage and Bricorama, and luxury retailers PPR, LVMH and Hermes.
- Make interest on mortgage for a main residence tax deductible.
POSITIVE IMPACT: Property stocks such Nexity, Kaufman & Broad and Nouveaux Constructeurs, construction groups Bouygues and Vinci, mortgage broker MeilleurTaux, lenders Credit Agricole Societe Generale and BNP Paribas, and Axa as home owners buy protection insurance.
- Reduce inheritance tax for most French people.
NEGATIVE IMPACT: May reduce life insurance volumes for Credit Agricole's subsidiary Predica.
- Has cast doubt on the planned government-backed merger of state-controlled Gaz de France and private utility Suez, saying he wants to consider whether GDF would be better off trying to link up with a larger gas producer.
IMPACT: This would hurt GDF as it would deprive it from foray into electricity sector, but could lift Suez, which is seen as a takeover target if the merger does not go through.
- Seen unlikely to end power regulated electricity tariff.
NEGATIVE IMPACT: EDF
- Seen open, given France's debt issue, to reducing state stakes in companies such as EDF, GDF, France Telecom, and Paris airports operator ADP.
One of Sarkozy's advisors backed the opening up of capital of state-owned French nuclear reactor maker Areva.
(list of stocks established from research notes from UBS, Societe Generale, Barclays, Berstein Research, Lehman Brothers and HSBC)
