Marine Le Pen, leader of National Rally, right, and Eric Ciotti, leader of The Republicans, second left, at a news conference in Paris, France, on Monday, June 24, 2024. President Emmanuel Macrons snap legislative election has opened the door to a world of uncertainty for investors confronting potentially seismic shifts in French economic policy. The second round of the snap election takes place on Sunday with 501 districts still up for grabs. The National Rally and its allies already won 39 races outright in the first round after they garnered 33.2% of the total vote.
“We’re not seeing the National Rally surging, as if they’d already pulled in the crowds in the first round,” Ifop political polling director François Kraus told Le Figaro newspaper.
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President Emmanuel Macron dissolved the lower house of parliament nearly four weeks ago and called a snap vote after his group was trounced in European elections.
France has been shaken by the prospect of the far right taking control of the government after spending more than 50 years keeping it at bay. It’s forced several other parties that had been at each other’s throats to swallow their animosity and come up with a largely unified electoral front in order to see off the threat.
The decision to call an election sparked a major selloff in French assets, with the benchmark CAC 40 Index losing as much as 6.5% and the gap between French and German 10-year yields widening to a peak of 86 basis points last week. Both bonds and stocks have since recovered some of their losses as the prospect of Le Pen winning an absolute majority wanes.
The index extended its gains following publication of the Ifop poll, up 0.8% on the day, led by banking shares including Societe Generale SA, Credit Agricole SA and BNP Paribas SA. The euro and French bonds were little changed.
Macron’s centrist alliance and the New Popular Front strategically pulled more than 200 candidates from runoff ballots this week to avoid splitting opposition to the far right in an attempt at building a so-called Republican front.
The latest projections suggest the strategy is working. Polling companies had given ranges that stretched as high as 305 seats for the National Rally and its allies after first-round voting ended last Sunday.
Ifop now projects the New Popular Front would win between 170 and 200 seats, while 95 to 125 would go to Macron and his allies. The polling company carried out an online survey of 1,916 registered voters on Wednesday and Thursday for LCI TV, Le Figaro newspaper and Sud Radio.