French banks plunged on the stock market on Friday amid concerns about the political situation in France and the country's borrowing costs, which have soared since President Emmanuel Macron decided to call early parliamentary elections.

At 08:32 GMT, Société Générale BNP Paribas and Crédit Agricole were down more than 3% on the Paris Bourse, among the biggest decliners on the CAC 40, which was down 1.5%.

The European banking sector >SX7E> was down 1.94%.

In addition to banks, construction and public works concession stocks such as Saint-Gobain, Thales and Veolia were also down.

The markets are particularly concerned about the outcome of the forthcoming French legislative elections on June 30 and July 7, especially after comments by Economy Minister Bruno Le Maire on the financing of French debt if the plans of the Rassemblement National (RN) or the alliance of left-wing parties come to fruition.

Bruno le Maire said on franceinfo on Friday that with the projects of the far left and far right, France's debt could not be financed.

On Friday, these comments led to a further fall in French equities, already battered since the start of the week after the unexpected announcement of early elections.

The gap between French and German 10-year bond yields has since widened. (Written by Diana Mandiá)