Halister News

(Bloomberg) -- In the search for the next Brexit/Trump-type event, markets are likely to focus on the French presidential elections next year; election of Marine Le Pen as president could seen as a similar outcome, Nomura economists, including Charles St-Arnaud, write in a note.

• Le Pen’s election unlikely, but the political risks associated with the vote will lead to an underperformance of OATs relative to peers
• Polls suggesting that Le Pen is likely to easily win the first round of voting, but the candidate from Les Républicains is likely to win the support of voters on the left and on the moderate right of the spectrum, making it unlikely Le Pen would have enough support to win the presidency
• Still, Nomura believes the Front National could make sizeable gains in the legislative election in June and become the third biggest party in the Assemblée Nationale which could tilt policy
• Elections also mean that little progress is likely to be made on advancing the economic reforms needed to promote growth over the coming months