The French stock market is up over 7% since Macron won the first round of the French elections. The German stock market just closed at a record high.
FX and equity market ‘hedges’ are non-existent as this weekend’s “done deal” election of establishment patsy Macron is 100% priced into markets…
As Bloomberg notes, there’s limited scope for a relief rally in the euro if centrist Emmanuel Macron wins the French presidency this weekend, options market data show. The one-month implied volatility of the euro versus the yen has dropped to 10 percent, from more than 20 percent during the first round of the election. That’s a sign of light positioning and low cost of protection against currency volatility ahead of the vote. The low correlation between options of France’s CAC 40 index and its components paints a similar picture.
via http://ift.tt/2phapZI Tyler Durden