The impending French parliamentary elections have sparked significant concern among investors and business leaders, with fears of politically extreme parties taking power. Scheduled for June 30 and July 7, the elections pit the far-right National Rally (RN) party and a left-wing coalition called New Popular Front against each other, alongside President Emmanuel Macron's centrist alliance.

The prospect of a party with little or no government experience governing the euro zone's second-largest economy is a source of anxiety for investors. Euronext CEO Stephane Boujnah articulated these concerns, emphasizing the potential turbulence in financial markets and the broader economic landscape. Speaking on France Inter radio, Boujnah noted the uncertainty associated with an inexperienced team assuming power.

Boujnah's comments are rare among French business leaders, who have largely remained silent. He highlighted the risks to the unity of French society and the potential impacts on business. An IFOP opinion poll suggests that RN could secure 36% of the votes in the first round, outpacing the New Popular Front at 28.5% and Macron's centrist alliance at 21%.

President Macron and his allies have intensified their warnings about the potential chaos if either extreme faction wins. Macron described the situation as a choice between himself or chaos, warning that a victory for RN or the New Popular Front could lead to civil unrest. Interior Minister Gerald Darmanin even indicated that police are preparing for possible riots related to the vote.

RN leader Marine Le Pen has dismissed Macron's warnings, accusing him of embodying chaos since his initial election. Despite these accusations, the far-right party continues to gain traction, with its Eurosceptic and nationalist agenda resonating with many voters. The uncertainty has led to a significant market selloff, with French stocks and bonds experiencing a heavy downturn following Macron's announcement of the snap elections.

France's economic structure, which heavily relies on public spending funded by borrowing from global markets, is particularly vulnerable to interest rate fluctuations. Boujnah stressed the necessity for international loans to sustain this model. Investor skepticism is further fueled by RN's proposed policies, such as reducing value-added tax on energy and lowering the retirement age, without transparent fiscal strategies.

Jean-Philippe Tanguy, RN's financial representative, defended the party's platform, stating that reversing Macron's pension reform to lower the retirement age to 62 would cost the state €9 billion but would be counterbalanced by other measures. However, investors and rating agencies remain unconvinced by the party's assurances of maintaining the state budget within EU boundaries.

The political climate has prompted various reactions, with Finance Minister Bruno Le Maire warning of a potential financial crisis and comparisons being drawn to the British 'project fear' strategy before the Brexit vote. Opinion polls suggest that Macron's coalition is struggling to gain traction, with his warnings not significantly influencing public sentiment.

As the election dates draw near, the financial markets are closely monitoring developments. The outcome could have profound implications not only for France's economic stability but also for investor confidence both domestically and internationally. The rising influence of political extremes highlights the deeply polarized nature of contemporary French politics and its potential impacts on governance and economic policy.