Markets toast Emmanuel Macron surge in French election as euro rises

 
Rebecca Smith
Markets have been relieved by forecasts playing out in the French election - so far
Markets have been relieved by forecasts playing out in the French election - so far (Source: Getty)

Markets have been bolstered by the news that centrist Emmanuel Macron is in pole position to triumph in the French presidential election, after pulling ahead in the first round.

The euro surged to a five-month high, surpassing $1.09 at one point, before dipping back to $1.0846.

European markets are expected to open higher too, with IG calling the FTSE 100 to open up 0.89 per cent and the French Cac up 2.33 per cent to 5,177.

Read more: A Macron victory could be good for Brexit

Markets, which had been anxious about the prospect of another Brexit or Trump-style surprise, rose in confidence. Japan's Nikkei increased 1.2 per cent.

The results of the first round of voting in France were largely in line with expectations, which helped to ease market concerns today. Neil Wilson at ETX Capital said a "market nightmare scenario" had been averted and there was something of a "relief rally" at the strong likelihood of a pro-EU, pro-euro President.

Read more: French election poll: Emmanuel Macron and Marine Le Pen set for final round

Macron, who achieved 23.8 per cent of the votes in the first round, will now face off against far-right candidate Marine Le Pen next month on 7 May, and is currently leading in the polls.

Le Pen won 21.5 per cent votes in the first round of voting.

Ipek Ozkardeskaya, senior market analyst at LCG, said: "The euro took a deep breath on Monday, after the first round results excluded the possibility of a Le Pen/Mélenchon run-off, a scenario which would have been dramatic and fundamentally detrimental for the single currency and has been broadly priced in during last week."

Investors had been concerned for the outlook for the euro had a far-left candidate made it through to compete against Le Pen in the final round.

In contrast, Macron wants closer ties with Europe and has pledged to reinforce France's commitment to both the European Union and the euro.

Read more: The French election is yet another blow for global trade policy

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