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Risk is definitely on this morning as European shares soar, led by French stocks and a new record high in Germany's Dax, after a "French relief rally" in which the first round of the country’s presidential elections prompted investors to bet that establishment candidate Emmanuel Macron will win a runoff vote next month, and who is seen as a 61% to 39% favorite to defeat Le Pen according to the latest just released Opinionway poll.

For those who may have missed yesterday's events, here is a quick recap from DB:

Ahead of the first round of the French elections on Sunday, Deutsche Bank's equity strategist Sebastian Raedler again reminds his bank's clients and the seemingly unperturbed markets, that despite the  tightening of the poll numbers among the four front-runners, European equities show little sign of pricing in a meaningful political risk premium. In fact, as he notes below, European equities appear to not have priced in even a modest political risk discount.

Global markets were oddly calm on Friday, the last day of trading before the first round of France's closely fought presidential election, with European stocks posting modest declines ahead of Sunday's main event, Asian shares rising, and set for first weekly gain in the past month, while U.S. futures were unchanged. French bond yields hit three-months low even as the euro has seen some recent weakness.

European stocks rose amid earnings beats, offsetting weakness in the energy sector and easing investor concerns ahead of the weekend’s French election. Asian shares and U.S. futures also rise. The dollar weakens against the euro and most crosses, while crude oil rebounds following renewed OPEC chatter of a production cut, this time with Saudi Arabia seemingly onboard.

European stocks rebounded after the biggest one-day drop since November, alongside S&P futures, while Asian equities posted modest declines after yesterday's weak US close. Gold and yen slid, while the dollar gained on the latest Mnuchin comments to the FT according to which Trump was "absolutely not" trying to talk down the dollar.