French equity futures jump after election result, analysts divided
Equity futures were pointing to a sharply higher open for French stocks after centrist Emanuelle Macron was revealed to have won the first round of voting in the country's presidential elections at the weekend.
This time the pre-election polls proved roughly correct, in an election that many observers billed as another battle in the current stand-off around the world between nationalists and globalists.
Macron, a political independent, made away with 23.8% of the ballots in Sunday´s vote, versus 21.5% for far-right candidate Marine Le Pen, based on Interior Ministry data with 97.4% of the vote count complete.
Nevertheless, the results of the vote still point to pronounced divisions among the electorate, leaving analysts divided on the outlook.
On the more cautious side of the spectrum of analysts' reactions, economists at Barclays Research said: "as we have stated previously, we believe the Parliamentary elections will carry more weight than usual, possibly even more than the Presidential election, but the outcome remains uncertain."
Nonetheless, two of Macron's rivals in the election, ex-PM Francois Fillon, and Socialist leader Benoit Hamon, immediately endorsed Macron.
That led Holger Schmieding at Berenberg to say "The result is more than a risk avoided. It offers a genuine chance to reform France and strengthen the Eurozone and the EU."
To take note of, in Paris the vote count currently shows that Macron trounced Le Pen, winning 35% of the vote, versus less than 5% for the candidate from the Front Nationale.
As of 0722 GMT, futures for France's main equity gauge, the Cac-40, indicate it is expecte to jump by about 4% at the start of trading, as the largest risk to the existence of the European Union and the euro area recede.
As for French debt markets, analysts at UniCredit Research believe the spread between French and German 10-year government bond yields might narrow from 70 points to 55 points "as a first target" and then to 40 points once the second round of the elections is over.
In parallel, the European single currency is 1.33% higher to 1.0866 against the US dollar.