The polls got it right.
Investors cheered Sunday after round one of the 2017 French presidential elections ended with centrist Emmanuel Macron topping the charts with 24% of the votes - as predicted by polls.
He was followed by far-right candidate Marine Le Pen, who received 21% of the votes. Macron has run on a pro-European Union platform, while Le Pen has called for France to potentially exit the EU and ditch the Euro.
That must have been a welcome relief for investors, who had feared that the anti-establishment Le Pen may come out on top. After all, polls had completely failed to predict the wave of populist and anti-establishment sentiment that led to President Donald Trump’s election in the U.S., as well as the U.K.’s decision to exit the E.U.
And after Macron scored the most votes, markets soared. In the U.S., the S&P 500 and Dow each closed up just over 1% Monday. In London, the FTSE 100 jumped 2%, while in Paris, the CAC 40 popped 4%.
“Pollsters have been proven wrong time and again over the past year - not only on Brexit and Trump’s election, but also during the Dutch elections,” a team of Moody’s analytics researchers wrote in a Friday note.
Bank stocks in particular jumped - having the most to lose under Le Pen - with the KBW bank index up 2.5% by the market’s close, and the Euro Stoxx Banks Index, which measures all of the EU, up 7%.
On the New York Stock Exchange, Germany-based Deutsche Bank jumped 11%, while Bank of America popped 4.5%. J.P. Morgan jumped 3.5%, while Goldman Sachs ended the day up 2.9%. Barclays rose 5.8%, and Morgan Stanley ended up 4.2%.
In Paris, banks were also the top performers, alongside shares of luxury carmaker Peugeot, which surged 6.6%, and media conglomerate Vivendi, which jumped 5.4%.