NEW YORK (Reuters) - Stocks on major markets rose along with the euro on Thursday as a market-friendly presidential candidate led in opinion polls ahead of elections in France on Sunday.
Former French finance minister, Emmanuel Macron, maintained a slim lead in polls, but the election is still a four-way battle in the first round vote on April 23. Should Macron rank first or second in Sunday’s election, he is seen easily winning the runoff vote on May 7 after remaining candidates are eliminated.
However, after surprises in last year’s U.S. election and the UK Brexit referendum, voter indecision and low turnout could catch markets wrong-footed yet again.
France’s CAC stock index .FCHI jumped 1.5 percent, its strongest daily performance since March 1.
On Wall Street, stocks rose as traders continued to bet on a strong earnings reporting season. Profit expectations have risen in the last two weeks and S&P 500 stock index company earnings now are expected to have gained 11.1 percent in the first quarter.
“You look at a day like today and it tells you there is a lot of cash on the sidelines that wants an opportunity to buy when the market sells off even just a little bit,” said Phil Blancato, CEO of Ladenberg Thalmann Asset Management in New York.
The Dow Jones Industrial Average .DJI was up 174.22 points, or 0.85 percent, to 20,578.71, the S&P 500 .SPX gained 17.67 points, or 0.76 percent, to 2,355.84 and the Nasdaq Composite .IXIC added 53.74 points, or 0.92 percent, to 5,916.78.
The Nasdaq closed at a record.
The pan-European FTSEurofirst 300 index .FTEU3 ended up 0.18 percent and MSCI’s gauge of stocks across the globe .MIWD00000PUS gained 0.63 percent. Emerging market stocks rose 0.58 percent.
EURO HOLDS NEAR 3-WEEK HIGHS
The euro held near a three-week high against the U.S. dollar as some traders closed out bets made on the grounds that the common currency would fall ahead of or after the election.
“Euro bulls will definitely respond to positive news around Macron, but that dissipates as the reality of low turnouts sets in,” said Alfonso Esparza, senior currency analyst at OANDA in Toronto.
The euro EUR= was up 0.09 percent against the dollar at $1.0719 after hitting a three-week high of $1.0777 earlier in the session.
Oil prices ended mixed, as investors weighed rising U.S. production against geopolitical uncertainties.
U.S. crude prices CLc1 settled down 17 cents at $50.27 a barrel. Brent futures LCOc1 posted modest gains, however, ending up 6 cents to $52.99.
U.S. Treasury yields rose as investors waited on the results from the French election and as rising risk appetite boosted stocks, after yields fell earlier and broke below key technical resistance.
The 10-year note US10YT=RR fell 12/32 in price to yield 2.25 percent. The yield briefly fell as low as 2.165 percent on Tuesday, the lowest level since Nov. 10, and it has tumbled from 2.63 percent on March 14.
In other commodity markets, U.S. gold futures GCcv1 fell 0.09 percent to $1,282.60 an ounce.
For graphic on French presidential election, click: tmsnrt.rs/2lPduBG
For graphic on global foreign exchange rates in 2017, click: tmsnrt.rs/2kIQHol
For graphic on global assets in 2017, click: reut.rs/2kD4BGA
For graphic on global bond dashboard, click: tmsnrt.rs/2lmwqHC
For graphic on global market cap, click: reut.rs/2pHTxif
Additional reporting by Chuck Mikolajczak, Saqib Iqbal Ahmed and Karen Brettell in New York, Tanya Agrawal in Bengaluru, Libby George and Patrick Graham in London; Editing by Nick Zieminski