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France's far right looks headed for victory in the first round at the polls. Here's what that means

With just days to go until France's snap parliamentary election kicks off, victory for the far right looks increasingly likely in the first phase of the two-stage runoff.

Marine Le Pen's National Rally and its allies are seen winning 36% of votes, signaling growing support for the party's euroskeptic, anti-immigration agenda, according to the latest opinion polls from Elabe released ahead of the first vote on June 30.

The left-wing New Popular Front, meanwhile, is projected behind with 27%, while President Emmanuel Macron's Renaissance party is predicted to clinch 20% of the support, as of June 27.

The shift away from centrist politics has spooked investors and analysts, who warn of implications ranging from "political paralysis" to "immediate financial crisis."

But predicting the outcome of France's final vote on July 7 is less clear cut, given the complexity of France's voting system.

CNBC takes a look at the likelihood of a far-right French victory and the impact for markets.

Under France's two-stage voting system, all parliamentary candidates who receive at least 12.5% of locally registered voters progress to the second-round runoff — a feat that the National Rally is likely to achieve in a large number of constituencies.

But even with sweeping gains in the first round, the party could be stumped at the final hurdle by voters using "le vote utile" — or tactical voting — to keep them out.

That was seen as part of Macron's gamble when the French leader called the surprise vote following the National Rally's record 31.3% gain in this month's European Parliament elections. Others say the president hopes to discredit his competitors ahead of France's 2027 presidential election, with Macron since claiming there will be "civil war"