Hollande tops Sarkozy in French vote 

click to enlarge France's President and UMP party candidate for the 2012 French presidential elections Nicolas Sarkozy speaks to supporters at La Mutualite meeting hall in Paris  after early results in the first round vote of the 2012 French presidential election April 22, 2012. - REUTERS/YVES HERMAN
  • REUTERS/Yves Herman
  • France's President and UMP party candidate for the 2012 French presidential elections Nicolas Sarkozy speaks to supporters at La Mutualite meeting hall in Paris after early results in the first round vote of the 2012 French presidential election April 22, 2012.

Far-rightist Marine Le Pen threw France’s presidential race wide open on Sunday by scoring nearly 20 percent in the first round — votes that may determine the outcome of the May 6 runoff between Socialist favourite Francois Hollande and conservative President Nicolas Sarkozy.

Following are comments from analysts on the results:

GILLES MOEC, ECONOMIST, DEUTSCHE BANK, LONDON

“I expect Sarkozy to campaign hard on the right, to try to woo far right electors. He will probably step up the ‘national’ themes (Schengen, ECB mandate) which may get him further away from (German Chancellor Angela) Merkel.”

“I don’t think that a Socialist victory is a short term issue for European dynamics.”

“The issues lay more in the medium term. France’s economy needs structural reforms. Hollande’s platform avoided these issues. French Socialists have a habit of straying away from their agenda when it collides with economic reality, but there may be a delicate transition phase.”

SIMON DERRICK, HEAD OF CURRENCY STRATEGY AT BANK OF NEW YORK MELLON, LONDON

“These exit results to me suggest that borrowing costs for France will go up, relative to Germany. We have seen them climbing in recent days and that should continue. Investors will be cautious in the next two weeks in the run up to the next round and I think this is overall negative for the euro.”

TOM ELLIOTT, GLOBAL STRATEGIST AT JPMORGAN ASSET MANAGEMENT

“I wouldn’t expect any sharp shift in the French 10-year yield curve or French stock volatility, as any uncertainty is already priced into the market.”

ACHILLEAS GEORGOLOPOULOS, RATES STRATEGIST, LLOYDS TSB, LONDON

“The figures seem to be very close to the most recent polls but for Le Pen it looks especially high. In terms of the market, it won’t have much impact. Hollande has the lead for now but it’s a bit more open because Le Pen did better than expected. The focus will be more on the Netherlands because they haven’t reached agreement about the (budget) cuts and they may call an election tomorrow.”

HOWARD WHEELDON, STRATEGIST AT WHEELDON STRATEGIC ADVISORY

“I think there are far greater concerns facing markets (Monday) morning than the specifics of the French election.

“There will be a shock, perhaps, in France, so the French market will be more volatile than the other European markets; but I would be surprised if the shock waves were felt elsewhere.”

NICOLAS SPIRO, MANAGING DIRECTOR, SPIRO SOVEREIGN STRATEGY

“French political risk has just become a lot riskier. Nearly a third of the electorate has voted for extremist parties. Even though the second round is a different ballot altogether, it’s clear how far apart France and Germany are on matters of economic policy. L’anti-Sarkozysme was always going to the key factor swaying French voters. Now Hollandisme will start to be more clearly defined.”

“While it’s almost a given that Mr Mélenchon’s supporters will back Mr Hollande in the second round, many National Front voters will refuse to support Mr Sarkozy. The weaker-than-expected performance of the Left Front should make it easier for Mr Hollande to fight a more centrist campaign. Mr Sarkozy is going to have move even further to the populist right to pick up National Front voters.” (Reporting by Leigh Thomas and Daniel Flynn in Paris, Simon Jessop, Anirban Nag, Emelia Soithole-Matarise in London)

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