Asian stocks stutter, euro gains after first round vote in France
Asian stocks were subdued on Monday as traders pondered the U.S rates outlook, while the euro edged higher after the far-right won a smaller share of the vote in the first round of France's shock snap election than some polls had projected.
The euro was 0.32% higher at $1.0747, while European stock futures rose 1% as exit polls showed Marine Le Pen's eurosceptic National Rally emerged ahead in the first round of the French vote but with fewer votes than some analysts had forecast.
The shock vote has unsettled markets as the far-right, as well as the left-wing alliance that came second on Sunday, have pledged big spending increases at a time when France's high budget deficit has prompted the EU to recommend disciplinary steps.
«Perhaps the result isn't as bad as the market had feared,» Michael Brown, senior strategist at Pepperstone.
«We've also seen a lot of rhetoric form other parties looking to perhaps pull out candidates to try and avoid the National Rally winning seats in the runoff next Sunday… The market may be taking a little bit of solace in that.»
The focus now shifts to next Sunday's runoff and will depend on how parties decide to join forces in each of the country's 577 constituencies for the second round, leaving investors still uncertain and jittery.
«With this result, markets are looking into another week of really high uncertainty. Probably fear, as it is still possible for RN to gain an absolute majority next week,» said Carsten Brzeski, global head of macro at ING in Frankfurt.
In Asia, the
