Marine Le Pen facing Jean-Luc Melenchon could be the worst scenario for the financial markets, says Saxo Bank’s head of macro analysis Christopher Dembik.

Two candidates for the French presidency will go head-to-head on May 7 following the first round of the election on April 23.

Melenchon, who wants to leave Nato and the IMF, has gained support in recent weeks because he is considered an anti-establishment candidate while Le Pen wants France to exit the European Union.

French indices such as the CAC 40 will dip should Melenchon qualify for the second round of voting, says Dembik, but Melenchon could become president because the ‘Republican Front’ - voters from different parties who will unite to try to block a Le Pen presidency.