France is always seen as the favorite team on paper. They were the team that made it to the final from the last world cup from the European continent. Even if they are unlucky against Argentina, at least after seeing their efforts, my favorite for the European championship would be France. Italy is also a strong European team. We have to remember what they did in the last European championship.
Italy may be a strong team but I don't consider them a favorite to win the UEFA Euro 2024. After all, they didn't even qualify for the last World Cup. We will see how well will they perform at the Nations League final four in a couple of months. I think that they don't have what it takes to beat Spain in the semi final game.
I don't think that failing to qualify for the last World Cup says anything about their chances for the upcoming Uefa Euro 2024. There are a couple of examples where one tournament was a disaster even during the qualification and then the tournament afterwards the team performed very well. I would have to look it up but I remember that those situations have happened before.
The Nations League is a bad predictor for the future performance. The Nations League is often used to test players, usually nobody takes it as serious as the World Cup and the Euro and I agree with that. The Nations League is often boring to watch.