European stocks rise after Macron records victory: French CAC 40 climbs 4.5 percent

PARIS, France - Centrist Emmanuel Macron’s victory in the first round of the French Presidential election has averted fears of a euroskeptic-only runoff sending European stocks surging.

On Sunday, Macron won the first round of the French presidential voting with 23.9 percent of the vote, ahead of far-right euroskeptic candidate Marine Le Pen with 21.4 percent.

The two are now set to face off in the final round of the election on May 7. 

A poll conducted late on Sunday from Ipsos/Sopra Steria showed that Macron would likely win that runoff by 62 percent to 38 percent.

Meanwhile, defeated conservative Francois Fillon and Socialist Benoit Hamon, the other two mainstream candidates defeated in the first round have thrown their support behind Macron. 

Le Pen has called for scrapping the euro and exiting the European Union, a view that European leaders are not very happy about.

Ipek Ozkardeskaya, senior market analyst at LCG said in a note to clients, “Her radical views on immigration, the European Union and the euro should see a solid resistance from the majority of the population.”

European stocks surged on the news of Macron’s victory - with the French CAC 40 rose 4.5 percent and is headed for its highest close since January 2008. 

The Stoxx Europe 600 index meanwhile climbed 2 percent, and Germany’s DAX 30 index was up 3 percent. 

The euro too gained 1.2 percent against the dollar, hovering at five-month highs.

The Nikkei 225 climbed nearly 1.4 percent, as investors backed away from perceived havens such as the Japanese yen. 

Pascale Auclair, global head of investment at La Francaise Asset Management has said, “The risk of a europhobic president has been lifted for markets. I think there will be a period of relief.”

Shares in French companies and banks recorded the biggest gains across the region with the euro zone's bank index rising over 5 percent to its highest level in 16 months.

Paris blue chips hit their highest since April 2015.

UniCredit analysts said in a note, “French banks alongside European banks will likely be the biggest winners.”

On Friday, Gold prices climbed amid investor uncertainty ahead of the French election.

Gold tumbled $16.60 or 1.3 percent to $1,272.50 an ounce. 

Dow Jones Industrial Average futures shot up 204 points, or 1 percent, to 20,704 on relief over the French vote.

S&P 500 futures surged 26.35 points, or 1.1 percent, to 2,373.75. 

Nasdaq-100 futures jumped 56.50 points, or 1 percent, to 5,498.50.

Yields for the 10-year Treasury jumped to 2.29 percent from 2.23 percent late Friday. 

The dollar shot to over 110 yen from a level of 109 yen late Friday in New York.

On Monday, U.S. stocks were set to rip higher and perceived haven assets gold and the yen fell, after Macron’s victory in the first round.

Major markets showed gains for the week, with the Dow rising 0.5 percent, the S&P 500  advanced 0.9 percent, and the Nasdaq gained 1.8 percent, on the heels of two weeks of declines.

Now, investors have set a hawk eye on a “massive” U.S. tax package that President Donald Trump is set to announce on Wednesday.