Stocks, Euro Surge as France's Macron Favored for Presidential Win

Europe's stock markets and the euro surged Monday after moderate candidate Emmanuel Macron won the first round of France's presidential election and looked set to triumph in the run-off against far-right candidate Marine Le Pen next month.

Germany's blue-chip share index, the DAX, hit an all-time high as stock markets across Europe and Asia breathed easier after pro-business French presidential candidate Emmanuel Macron's first-round success.

The Frankfurt index of 30 leading stocks briefly touched 12,428.62 points, compared with the previous record of 12,391 reached in April 2015.

- 'Relief' is the word -

Wall Street also posted healthy gains as trading got under way in New York.

"Relief. That is the word that basically describes the sharp moves in the markets today," said Fawad Razaqzada, a market analyst at Forex.com.

The euro shot higher to trade above $1.09 at one point, compared with $1.0726 on Friday.

"European markets are in a buoyant mood... after the French pollsters got it near enough spot on," said Joshua Mahony, market analyst at IG trading group.

"The move back into risk assets means the chief losers have been the likes of gold and the Japanese yen, with stock markets moving sharply higher."

The price of gold fell by nearly 1.5 percent on the day.

Investors globally had been fearful that a wave of populism, which swept Donald Trump to the White House and saw Britain vote to leave the EU, could lead to a win for the anti-European Le Pen and put the future of the bloc in doubt.

However, Macron is widely expected to gallop to victory over the divisive Front National leader and traders gave a huge thumbs-up.

"Markets are happy to buy what they see as the fact -- that 39-year-old Emmanuel Macron will be confirmed as the next president of the French republic in two weeks' time," Ray Attrill, head of FX strategy at National Australia Bank, said in a commentary.

- The bulls are back -

Some cautioned that the party mood may fizzle out by the time of the second election round in two weeks' time, but in the meantime enthusiasm was rampant.

"Bullishness has returned to equities," said Mike van Dulken, Head of Research at Accendo Markets.

The surge in optimism drove down the yen -- considered a safe bet in times of uncertainty -- which in turn lifted Japanese exporters.

Tokyo's Nikkei ended up 1.3 percent, Sydney added 0.3 percent, Seoul gained 0.4 percent and Wellington put on 0.4 percent.

Hong Kong closed 0.4 percent higher but Shanghai sank 1.4 percent, extending a recent sell-off fueled by profit-taking, liquidity concerns and regulatory plans.

The gains in Asia extended Friday's rally that was built on comments from U.S. Treasury Secretary Steven Mnuchin, who promised that a tax reform plan would be unveiled soon.

That was followed by Trump saying Friday that there would be "a big announcement on Wednesday having to do with tax reform."

Eyes are now on Washington, where lawmakers have just four days to agree a funding bill to avoid a painful government shutdown that would cost the economy billions of dollars.

There are fears Trump will refuse to sign anything that does not contain spending for his controversial Mexican border wall, with Democrats saying they will not back anything that does include such provisions.

Oil had another volatile day as investors mulled the chances of OPEC extending an output cut agreement beyond June. After a firmer start, the oil price fell back into negative territory by the European afternoon on selling by traders doubting that any extension, if agreed, would actually soak up the current glut on oil markets.

- Key figures at 1335 GMT -

New York - Dow: UP 1.0 percent at 20,572.29 point

London - FTSE 100: UP 1.8 percent at 7,242.02

Frankfurt - DAX 30: UP 3.0 percent at 12,409.80

Paris - CAC 40: UP 4.1 percent at 5,266.86

EURO STOXX 50: UP 3.7 percent at 3,567.86

Tokyo - Nikkei 225: UP 1.4 percent at 18,875.88 (close)

Hong Kong - Hang Seng: UP 0.4 percent at 24,139.48 (close)

Shanghai - Composite: DOWN 1.4 percent at 3,129.53 (close)

Euro/dollar: UP at $1.0870 from $1.0726 at 2100 GMT Friday

Pound/dollar: DOWN at $1.2792 from $1.2810

Dollar/yen: UP at 110.15 yen from 109.15 yen

Oil - Brent North Sea: DOWN 17 cents at $51.79 per barrel

Oil - West Texas Intermediate: DOWN 8 cents at $49.54