China Sets the Stage to Replace the U.S. as Global Trade Leader

BCA argues that President Donald Trump will need to work more cooperatively with the Chinese to regain market share for American ATPs if he’s truly committed to creating quality manufacturing jobs here in the U.S. At the moment, it’s unclear whether he’s serious about actually imposing sanctions on Chinese goods or whether he’s using the threat simply as a negotiating tactic.

I agree with BCA’s analysis. Trump’s isolationist and protectionist leanings certainly raise the specter of a trade war with China, which would likely end up being worse for U.S. businesses and consumers in the long run. According to Oxford Economics, our trade relationship with China supports about 2.6 million jobs in the U.S. and has helped put money in Americans’ wallets by keeping consumer prices lower than they otherwise would have been. A typical American family making $56,500 in 2015 saved about $850 that year because of trade with China, Oxford estimates.

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“Brewing trade tensions between the world’s two largest economies are undoubtedly negative for both the global economy and financial markets,” BCA writes, recommending that investors “should certainly hedge against such a scenario… with long positions on the dollar, gold, and the VIX,” or the Chicago Board Options Exchange (CBOE) Volatility index.

BCA makes a compelling case for gold. I’ve always recommended a 10 percent weighting—5 percent in bullion (coins, wafers and 18-22 carat jewelry), the other 5 percent in quality mining stocks and mutual funds.

China Champions Free Trade

Now that Trump is rethinking America’s involvement in free-trade agreements such as NAFTA, having already withdrawn the U.S. from the controversial Trans-Pacific Partnership (TPP), President Xi Jinping seems interested in positioning China as the global leader in free trade.

Earlier this month, Xi made the first-ever visit by a Chinese president to the World Economic Forum’s annual meeting in Davos, Switzerland, where he urged the world to “say no to protectionism.”

“Pursuing protectionism is like locking oneself in a dark room. While wind and rain may be kept outside, so are light and air,” he colorfully said. “No one will emerge as a winner in a trade war.”

It’s definitely a sharp departure from the norm of the past several decades that China should emerge as the world’s top defender of global trade at a time when the U.S. is set to turn inward, but this is the reality we live in now. I’m not the only one who feels this way. Speaking to Congressional Republicans in Philadelphia this week, U.K. Prime Minister Theresa May said that, while both countries are now on a more isolationist trajectory, the U.S. and U.K. must resist the “eclipse of the West.”

“We—our two countries together—have a joint responsibility to lead,” she said, “because when others step up as we step back, it is bad for America, for Britain and the world.”

As if to reaffirm its commitment to being a global leader in trade and economic development, China just agreed to cooperate with the Philippines on 30 regional infrastructure projects valued at $3.7 billion, according to Global Trade Magazine. This comes despite the two countries sharing a traditionally strained relationship over territorial rights.

What’s more, the China-led Asian Infrastructure Investment Bank (AIIB)—founded in 2015 to serve as an alternative to Western creditors such as the World Bank and International Monetary Fund (IMF)—will be joined by 25 new member-nations this year alone, including Ireland, Canada, Ethiopia and Sudan. The bank is leaving the door open for U.S. membership, but that appears unlikely under a Trump administration.

In its monthly investment report, HSBC recommends an overweight position in Chinese equities, citing improved economic activity, policy stimulus and strong credit. As for a U.S.-China trade war, the investment bank believes it to be unlikely. However, “rising trade protectionism or U.S.-China trade frictions may accelerate the development of high-valued industries in China,” it writes.

Touring the World’s Largest Building

On a final note, I was in Vancouver this past weekend attending and speaking at the annual Vancouver Resource Investment Conference alongside old friends and colleagues such as Frank Giustra, Thom Calandra and many others.

While up there, my friend Marin Katusa of Katusa Research organized a tour of Boeing’s monolithic Everett factory near Seattle, where the plane-maker builds its 747, 767, 777 and 787 Dreamliner jets.

At 13.3 million cubic meters, Boeing’s factory is recognized as the world’s largest building by volume. Words fail me in trying to describe how small and insignificant you feel in the presence of the site, which covers a massive 98.3 acres. The doors alone are the size of football fields. Among the world locations that could comfortably fit inside are the Pentagon, the Pyramids and all of Disneyland.

The thing is so monstrous, it has its own weather system.

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It’s helpful to think of the factory as a small enclosed city, complete with its own hospital, daycare center, fire department and more. Security is very tight, and a strict “no photos” policy is enforced, for obvious reasons.

That’s why I recommend you go on the factory tour yourself the next time you’re in the Seattle area. Or make a special trip of it. Take a friend. It’s an impressive, awesome reminder of what American ingenuity and innovation is capable of, and I’m grateful to Marin for the opportunity to visit it.

On behalf of everyone at U.S. Global Investors, I want to wish you a Happy Chinese New Year! May the Year of the Rooster bring you lasting happiness, strong health and good fortune!

Index Summary

• The major market indices finished up this week. The Dow Jones Industrial Average gained 1.34 percent. The S&P 500 Stock Index rose 1.03 percent, while the Nasdaq Composite climbed 1.90 percent. The Russell 2000 small capitalization index gained 1.40 percent this week.
• The Hang Seng Composite gained 2.10 percent this week; while Taiwan was up 1.25 percent and the KOSPI rose slightly by 0.87 percent.
• The 10-year Treasury bond yield rose one basis point to 2.48 percent.

Domestic Equity Market

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Strengths

• Materials was the best performing sector of the week, increasing by 3.44 percent versus an overall decrease of 1.02 percent for the S&P 500.
• Seagate Technology was the best performing stock for the week, increasing 22.02 percent.
• Microsoft beat on the top and bottom lines. Microsoft earned an adjusted $0.84 a share on revenue of $25.8 billion. Revenue from its Productivity and Business Processes unit, which includes the fast-growing Office 365 cloud productivity suite, jumped 10 percent versus a year ago to $7.4 billion.

Weaknesses

• Telecommunications was the worst performing sector for the week, falling 1.74 percent versus an overall decrease of 1.02 percent for the S&P 500.
• Qualcomm was the worst performing stock for the week, falling 13.74 percent.
• U.S.-based miner Freeport-McMoRan Inc. reported weaker-than-expected fourth-quarter earnings. The company warned of output and job cuts at its mine in Indonesia if it can't secure a permit to export copper concentrates, Reuters reported.

Opportunities

• Fiat-Chrysler Automobiles CEO Sergio Marchionne is optimistic about President Donald Trump's plans. During the company’s earnings call on Thursday, Marchionne said, "there's no doubt that the full delivery of the set of financial – the set of economic parameters that President Trump has raised are overall positive for us."

• Verizon and Charter are exploring a merger. According to The Wall Street Journal, Verizon CEO Lowell McAdam approached officials "close to Charter," and they're in preliminary talks.
• eBay's revenue jumped during the crucial holiday quarter. The online auction site reported revenue climbed 3.1 percent in the fourth quarter versus a year ago. "During the holiday season, eBay was one of the top consumer shopping destinations in the world and the second most visited e-commerce site in the U.S.," said Devin Wenig, eBay's president and CEO.

Threats

• Starbucks slashed its 2017 revenue forecast. The coffee giant announced first-quarter results that were mostly in line with Wall Street estimates but said it saw 2017 revenue growth of 8 percent to 10 percent, down from its previous estimate of a double-digit rise, Reuters reports.
• RBS is setting aside more cash for its U.S. mortgage-backed security investigation. The bank announced on Thursday that it would set aside an additional $3.92 billion in preparation for the settlement of allegations it sold toxic mortgage-backed securities leading up to the financial crisis, Reuters says. The bank has now set aside $8.3 billion to deal with those claims.
• Caterpillar beat on fourth-quarter earnings but once again lowered its outlook for the year ahead. The industrial-equipment maker said it cut its outlook "due to the strengthening of the U.S. dollar."

The Economy and Bond Market

Strengths

• Markit Economics' flash U.S. purchasing manager's index (PMI) rose to 55.1 in January. New orders jumped at the fastest rate in two years, "thanks mainly to rising demand from customers in the home market," the report said on Tuesday.
• U.S. economic data showed a third straight month of improved capital expenditures. Capex has been particularly sluggish in recent years, and an upturn in capital investment could contribute to better corporate profits down the road.
• The Dow Jones Industrial Average closed above 20,000 on Wednesday for the first time in its 120-year history.

Weaknesses

• After getting a major lift from a surge in U.S. soybean exports in the third quarter, U.S. economic growth slackened to an annualized pace of 1.9 percent in the fourth quarter from the 3.5 percent reading in the third quarter.
• New home sales fell to a 10-month low in December, by 10.4 percent at a seasonally adjusted rate of 536,000.
• At least six oil-producing U.S. states are estimated to be in the midst of a recession, according to S&P Global Ratings. The ratings company said yesterday that Alaska, Louisiana, New Mexico, North Dakota, Oklahoma and Wyoming would likely see their economies contract between 2015 and 2016. This comes as a result of the sharp pullback in exploration and production during the past 18 months.

Opportunities

• President Donald Trump says he will soon begin renegotiating NAFTA. Trump has announced that he plans to speak with the leaders of Canada and Mexico to renegotiate the 23-year-old trade deal, Reuters reports. "We are going to start renegotiating on NAFTA, on immigration, and on security at the border," Trump said on Sunday.
• The Trump administration took a series of executive actions in its first week in office including approving the long-stalled Keystone XL and Dakota Access pipelines. Trump met with the CEOs of several manufacturing companies, including the Big Three automakers, and encouraged them to build new plants in the United States. Trump also met with union leaders. The administration also announced it will nominate a replacement for Supreme Court justice Antonin Scalia on 2 February.
• Three of G7 central banks will hold policy meetings next week. Although no changes are expected, hints could be provided in regards to the future path of monetary policy.

Threats

• Sean Spicer, White House press secretary for President Donald Trump, said the administration is considering a 20 percent border tax on Mexican imports, according to the White House press pool report.

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• Growth in consumer spending slowed to 2.5 percent from 3.0 percent in the latest U.S. GDP report. It will be key to watch the outcome of the average hourly earnings release next week as it could be an indicator of future consumption.
• Despite all the talk about economic reflation, the Conference Board's leading economic indicator (LEI) is not yet signaling a major acceleration in GDP growth.

Gold Market

This week spot gold closed at $1,191.59, down $18.98 per ounce, or 1.57 percent. Gold stocks, as measured by the NYSE Arca Gold Miners Index, ended the week slightly higher by 0.17 percent. Junior tiered stocks outperformed seniors for the week, as the S&P/TSX Venture Index climbed just 1.51 percent. The U.S. Trade-Weighted Dollar Index finished the week down by 0.16 percent.

Date	Event	Survey	Actual	Prior
Jan-26	Hong Kong Exports YoY	6.7%	10.1%	8.1%
Jan-26	U.S. Initial Jobless Claims	247k	259k	237k
Jan-26	U.S. New Home Sales	588k	536k	598k
Jan-27	U.S. GDP Annualized QoQ	2.2%	1.9%	3.5%
Jan-27	U.S. Durable Goods Orders	2.5%	-0.4%	-4.8%
Jan-30	Germany CPI YoY	2.0%	--	1.7%
Jan-31	Eurozone Core CPI YoY	0.9%	--	0.9%
Jan-31	U.S. Consumer Confidence	112.5	--	113.7
Feb-1	U.S. ADP Employment Change	165k	--	153k
Feb-1	U.S. ISM Manufacturing	55.0	--	54.5
Feb-1	FOMC Rate Decision	0.75%	--	0.75%
Feb-2	U.S. Initial Jobless Claims	250k	--	259k
Feb-2	Caxin China PMI Mfg	51.8	--	51.9
Feb-3	U.S. Change in Nonfarm Payrolls	170k	--	156k
Feb-3	U.S. Durable Goods Orders	--	--	-0.4%

Strengths

• The best performing precious metal for the week was platinum, up 0.74 percent. Silver also clocked a positive gain of 0.28 percent. Economic growth in the U.S. slowed more than forecast last quarter on the biggest trade drag in six years, reports Bloomberg. Net exports subtracted 1.7 percentage points from expansion in the October – December period, as dollar strength likely was a drag on growth. Should the new Trump administration push for a weaker dollar, this could lend support to gold.
• China purchased a net 47 tons of bullion in November, according to data from the Hong Kong Census and Statistics Department and compiled by Bloomberg. Additionally, shipments of gold from Switzerland to China surged more than fivefold to 158 tons in December, Bloomberg continues, the highest since at least January 2014. Appetite for gold is soaring ahead of the Lunar New Year.
• According to Bloomberg, the four ETFs backed by gold that have attracted the most money this year are all based in Western Europe. Xetra-Gold, listed in Frankfurt, tops the list by bringing in around $544 million last week. Europeans are turning to the gold on fears that Trump’s “America first” rhetoric will impede global economic growth.

Weaknesses

• The worst performing precious metal for the week was palladium, down 6.65 percent. The metal is headed for its worst weekly drop in more than a year. CPM Group reported they see palladium and platinum in surplus for the next few years and estimated there are 25 million ounces of palladium in stockpiles, most held by investors.
• Physical gold demand fell in 2016 to its lowest level since 2009, reports Reuters, as increased prices weighed on appetite for the metal. GFMS, a research unit of Thomson Reuters, also notes that gold jewelry demand is at a 28-year low. Jewelry consumption is down 9.7 percent year-over-year at 551 metric tons in the fourth quarter.
• As U.S. equities looked to extend a rally on Friday, gold retreated for what might be a fourth-straight day of losses. However, real rates dropped a bit before the market open and gold eventually crawled into positive territory. “Gold was due for a short-term pullback, after rallying almost non-stop since late December,” Jordan Eliseo of Australian Bullion Co. said. “Strength in equity markets, with the Dow topping 20,000 points, soft physical markets and a greater focus on rate hikes from the Fed has seen the metal sell off.”

Opportunities

• UBS says the dollar has peaked and is likely to decline this year under President Trump, reports Bloomberg. The wealth management unit at UBS expects the currency’s future weakness to boost the price of base and precious metals. “We hold that view because we see real interest rates going deeper into negative territory.” Earlier in the week Steve Mnuchin also commented on the dollar, defying two decades of convention at the office of the U.S. Treasury Secretary by stating, “From time to time, an excessively strong dollar may have negative short-term implications on the economy.” In a similar note, Brown Brothers Harriman noted a recent St. Louis Fed study which showed how a strong dollar from 2014 to 2016 was associated with a drag on growth from net exporters

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• According to BlackRock, inflation is rising faster than many investors may realize, citing examples such as rising housing prices, uncontained medical inflation, rising wages and more. So what does this mean for investors? BlackRock says, “Should inflation expectations rise faster than nominal rates, gold is likely to continue to merit a place in most portfolios.”
• The World Gold Council believes the Indian government should lower the taxes on gold, currently at 13 percent, to help curb smuggling and promote transparency in local gold trade, reports Bloomberg. With a high customs duty, gold is being imported through the unofficial channel, the article continues. If India wants to eliminate corruption, a high tariff only encourages smuggling.

Threats

• BNP Paribas SA, the top gold and precious metals forecaster in the fourth quarter according to Bloomberg, expects the Federal Reserve to go “rapid-fire” on interest rates, boosting them every quarter in 2018. This tightening will strengthen the U.S. dollar and push gold down toward $1,000 an ounce, reports Bloomberg.
• The forecasted gold demand recovery from a seven-year low in India has been delayed, according to the World Gold Council. The WGC says gold consumption in the country will not return to normal levels until 2018, as a liquidity squeeze tightens spending this year, reports Bloomberg. In a report published Tuesday, the group estimates India’s usage between 850 metric tons to 950 tonnes by 2020 versus demand of 650 to 750 tonnes in 2016.
• Two of the biggest gold producers in South Africa, Sibanye Gold and AngloGold Ashanti, have been accused of putting workers’ lives at risk, reports Bloomberg. The Department of Mineral Resources argues that the companies are unwilling to follow the laws, while the two miners have criticized government inspectors for being too heavy-handed in temporarily closing mines for safety breaches, the article continues. AngloGold won a court ruling in October that blocked one such closure and Sibanye is suing Minister Mosebenzi Zwane and other officials for compensation after its Kroondal platinum mine was closed. Over the past decade AngloGold has reduced operating fatalities by more than 80 percent.

Energy and Natural Resources Market

Strengths

• Commodities may continue to outperform on the back of a weaker U.S. dollar. UBS argues the U.S. dollar has peaked and is set to “roll over” refuting the case for a stronger dollar fueled by President Trump’s plans to increase infrastructure spending and cut taxes. Instead the bank argued that these plans will lead to a twin deficit situation which is negative for the currency and ultimately positive for commodity prices.

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• The best performing sector for the week was the S&P/TSX Composite Diversified Metals & Mining Sub Industry index. The index rose 7.9 percent after copper prices advanced 2.5 percent this week following Trump’s inauguration.
• Norsk Hydro, a Norwegian aluminum and renewable energy company, was the best performing stock this week finishing up 10.4 percent. The stock rallied on the back of rising aluminum prices as supply for the metal is expected to decline as China shuts down capacity.

Weaknesses

• Palladium was the worst performing commodity this week falling 5.9 percent. The drop in the price of palladium was attributed to producers hedging as the commodity surged to a 22-month high last week.
• The worst performing sector this week was the S&P/TSX Composite Oil and Gas Exploration and Production Sub Industry Index. The index fell 0.1 percent as investors fear protectionist trade policies instituted by President Trump may limit U.S. demand for Canadian production.
• The worst performing stock for the week was Eni S.p.A., the Italian integrated oil and gas company. The company fell 4.9 percent on the back of falling oil prices and an order from the Nigerian court to give up control of a jointly owned oil license with the country.

Opportunities

• The fundamentals for copper have improved according to a research note released this week by Macquarie. The first wave of fourth quarter production reports were released this week and showed major producers missed output expectations. In addition, the prospect of a serious strike exists from the world’s largest mine, Escondida, owned and operated by BHP Billiton. As demand factors are beginning to pick up, any disruption to the mining supply chain could potentially benefit and support higher copper prices.
• Aluminum prices may continue to rise as production may be constricted this year as the Ministry of Environmental Protection in Beijing attempts to curb pollution. In recent years, global production has become a function of Chinese smelters which account for a third of global production to support the countries rapid growth. If the country follows through on capping production, aluminum prices may extend last year’s rally.
• Hedge funds are bullish on oil prices, sending bets to the highest level on record according to regulatory and exchange data. The rationale behind the appetite is to back a long awaited recovery in the depressed market which will further be boosted by supply cuts from OPEC producers and other major producers such as Russia. A positive read-through for the whole energy complex.

Threats

• U.S. economic growth slowed sharply in the fourth quarter of 2016 on the back of falling exports according to Reuters. The economy grew at 1.6 percent in total for 2016, the weakest pace since 2011 as cheap oil and a strong U.S. dollar are hampering global competitiveness. The slow pace of economic growth in the U.S. may temper appetite for commodity prices even as President Trump enacts pro-growth policies.
• Baker Hughes, one of the world’s largest oil field services companies with operations in over 90 countries, says only higher oil prices will spur international spending on equipment. The current prices in oil acts as a cap towards spending on projects and infrastructure as producer’s margins are challenged, negatively affecting service companies.
• Gold fell 1.6 percent this week as sentiment shifted toward pro-growth sectors. The price of gold is feeling the heat of Trump’s pro-growth fiscal policy. The risk of further pro-growth policy announcements may pressure gold prices in the short term.

China Region

Strengths

• The Hang Seng Composite Index (HSCI) climbed to multi-month highs ahead of the Lunar New Year holidays.

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• The Philippines’ fourth-quarter GDP data came in at a robust 6.6 percent year-over-year growth rate, in line with expectations. Despite a slight miss on quarter-over-quarter numbers (1.7 percent actual versus 1.9 percent expected), the Philippines continues to hum along with one of the fastest GDP growth rates in the region. 2016 GDP growth was a solid 6.8 percent.
• Year-over-year industrial production in Singapore surged at its fastest pace in years, jumping to 21.3 percent for the December period.

Weaknesses

• Year-over-year industrial profits in China slowed to a pace of 2.3 percent growth for the December period, behind the prior 14.5 percent.
• Taiwan’s GDP data missed expectations. Preliminary fourth-quarter GDP came in at 2.58 percent, below expectations of 2.85 percent, while annual year-over-year GDP rose 1.4 percent, shy of expectations for 2.5 percent.
• China’s central bank is ordering the nation’s lenders to curb new loans in the first quarter, Bloomberg News reports, as part of continued efforts to crack down on leverage. The latest moves may make errant lenders pay more for deposit insurance.

Opportunities

• The Lunar New Year holidays have begun. It will be a quiet week in many markets but soon investors will see measurements and metrics on consumer habits leading into and around the holidays.
• Next week we get purchasing managers’ index (PMI) readings. Official China Manufacturing PMI expectations are for a reading of 51.2 (versus a prior 51.4 in December), with a Caixin Manufacturing PMI of 51.8, down slightly from 51.9 in December.
• Bloomberg News reports that S&P Global Ratings stated in recent weeks that Indonesia’s credit rating may be raised in 2017 or 2018 if the country’s fiscal situation continues to focus on “deliver[ing] better quality spending, deficits on a declining trend, moderate government debt, and limited contingent fiscal responsibilities.”

Threats

• As President Donald Trump concludes his first week in office, numerous details regarding China and trade remain uncertain. Trump made good on his promise to terminate U.S. involvement in the Trans-Pacific Partnership (TPP), with no replacement on the horizon at this point. And while Trump seems keen on the art of the deal, so to speak—and thus pragmatic—investors still do not know what shape such pragmatism might take with respect to U.S. trade for the region, or what disruptions might be caused.
• Yuan weakness—staved off recently as the currency strengthened somewhat— and capital outflows from China remain an ongoing longer-term threat.
• Hong Kong has held on to the questionable title of the planet’s priciest market for homes: the average home in Hong Kong costs some 18.1 times median pretax income, according to Bloomberg News, and represents a “substantial deterioration” in affordability. (Second and third places, respectively, go to Sydney, Australia and Vancouver, Canada.)

Emerging Europe

Strengths

• Russia was the best performing country this week, gaining 4.9 percent. A possibly warmer relationship with the U.S. under the Donald Trump administration may lead to the removal of sanctions imposed on Russia after the annexation of Crimea. Putin and Trump will hold their first call this Saturday.
• The Polish zloty was the best performing currency this week, gaining 70 basis points against the U.S. dollar. The Polish government expects inflation to pick up this year and exceed 1.5 percent. Gross domestic product should reach 3.5 percent, and improvements in the tax collection process may increase state revenue by more than 10 billion zloty, helping to balance the budget.
• The materials sector was the best performing sector among eastern European markets this week.

Weaknesses

• Hungary was the worst performing country this week, losing 50 basis points. The National Bank of Hungary left the benchmark rate at a record low 0.9 percent, as expected. The rate could be kept unchanged until inflation reaches its target of 3 percent.
• The Turkish lira was the worst performing currency this week, losing 2.9 percent against the U.S. dollar. Despite the central bank taking actions to support the lira, it is heading for its biggest drop in two weeks after President Recep Tayyip Erdogan asked again for a rate cut.
• The real estate sector was the worst performing sector among eastern European markets this week.

Opportunities

• The first preliminary PMI surveys of 2017 suggest that the Euro area and its two largest economies, Germany and France, started the year strongly. January manufacturing PMI for the eurozone was reported at 55.1, Germany at 56.5 and France at 53.4.

• Russia overtook Saudi Arabia in 2016 to become China’s biggest crude oil supplier for the first time ever, customs data showed on Monday. Russian shipments surged to 1.05 million barrels per day, with Saudi Arabia coming in a close second with 1.02 million barrels per day. China is the world’s second largest oil buyer and the fastest growing major importer. Russia may maintain the top spot in 2017 as it expands exports of its East Siberian-Pacific Ocean (ESPO) pipeline.
• Deputy Prime Minister Mateusz Morawiecki said that Poland estimates it will attract 25,000 – 30,000 new jobs from Britain this year in the sector of advanced business services. As the U.K. exits the eurozone bloc, big banks and their Euro clear operations may be moving to Frankfurt and Paris, while the lower wage countries in central and Eastern Europe may attract companies to resettle their back-office and other operations. UBS AG has one of its two global hubs in Krakow, Goldman Sachs will expand its Warsaw office, and JPMorgan may move as many as 2,500 jobs to central Europe.

Threats

• Ildar Davletshin, an analyst at Renaissance Capital, says there is limited upside for Russian oil producers unless oil doubles. Russia has a progressive tax system and it means that most of oil price gains since OPEC announced production cut have gone to the state budget. Producers only get a $2 benefit when oil increases by $10 per barrel. Also, a stronger ruble is increasing costs on production, reducing profits and free cash flow.

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• Fitch will announce its credit rating decision for Turkey late on Friday. If it downgrades Turkey’s credit rating, all three rating agencies will rank the country below investment grade. Further equity and currency weakness may follow.
• Marine Le Pen, National Front Leader, is ahead in a poll on the first round of France’s presidential election. A victory for Le Pen on April 23 would set up a run-off vote in May, raising the prospects that an open critic of the euro could become the next president of the region’s second biggest economy.

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