LIVE MARKETS-How about a Gaullist Le Pen

Investors remain cautious on French assets, worried about the country’s fiscal trajectory and the outcome of presidential election and a possible victory of right-wing Marine Le Pen or Jordan Bardella.

While BCA Research recommends avoiding French risk assets, it argues that a Le Pen victory could, in the end, be better for markets than many investors expect.

It recalls that in January 2026, German foreign minister Lars Klingbeil said that now is the time for a Europe of two speeds, with a faster-moving core of member states pushing ahead with deeper integration.

“A ‘two-speed’ Europe may, in fact, be precisely what Europe needs,” it says. BCA flags that Le Pen/Bardella will get on board with this approach, which could ease a “policy sclerosis in Europe” when the area grapples with major challenges, from further economic integration to defence.

“A more de Gaullist approach to European integration, one led by a core of nation states, is far more likely to effectuate change.”

With a victory of the Rassemblement National's candidate, “France would become more sceptical of further political integration, enlargement to the Balkans, more reluctant to support common borrowing or deeper fiscal union, and more willing to align with other nationalist governments on issues such as migration, energy, and sovereignty”, BCA Research argues.