MORNING BID EUROPE-French "Third Man" adds to uncertainties

* A look at the day ahead from European Economics and Politics Editor Mark John and EMEA markets editor Mike Dolan. The views expressed are their own.

LONDON, Nov 21 (Reuters) - Another election, another upset. Polls may have hinted at last-minute gains for Francois "Third Man (Swiss: MAN.SW - news) " Fillon in the presidential primaries of France's conservatives but not at the sheer size of his lead after the first round. Erstwhile favourite Alain Juppe insists he can still win in next Sunday's run-off but ex-premier Fillon barely needs to win another six percentage points of votes to take him past the finishing post. If he does get the conservative ticket, the big unknown is how he would fare against Marine Le Pen (Other OTC: PENC - news) if the two came head-to-head in a presidential run-off next May. The centrist Juppe was seen as a safe bet to defeat her; Fillon -- a rare economic liberal in France, advocating heavy public spending cuts to fund tax easing for business -- might be less able than Juppe to scoop up left-wing votes and would also be an easier target for Le Pen's protectionist assaults. On the other hand, Fillon's stance on Europe has a plausibly sceptical tinge to it, given that he voted against the Maastricht Treaty and the doomed EU constitution. That might put him on the same wavelength with many voters in France right now.

MARKETS AT 0755 GMT

With (Other OTC: WWTH - news) markets on tenterhooks for European electoral surprises following Donald Trump's victory in the U.S. election and the Brexit vote earlier in the year, the defeat of Nicholas Sarkozy in the first round of the French presidential primaries on Sunday throws up another political surprise. Pro-business social conservative Francois Fillon is now favourite to become the centre-right candidate and although polls show he would likely beat National Front leader Marine Le Pen in the presidential ballot, some say it will add greater uncertainty as many left-wing voters would be reluctant to vote for him. The tense European political calendar over the next six to nine months provides the flipside to mounting dollar strength last week on the back of Trump's victory earlier this month. Euro/dollar is firmer since Friday however and has recaptured $1.06, but peripheral euro zone debt spreads continue to widen on euro area political tension. Portugal's 10-year yields rose to a 9-month high earlier. Trump-inspired dollar strength is being felt more broadly in Asia, with dollar/yen hitting its highest since May early on Monday above 111/$ and helping Japan's Nikkei225 up almost 1 percent. China's yuan is also feeling the heat, with the PBOC's midpoint set weaker for the 12th consecutive session to 6.8985 -- its weakest in 8-1/2 years. One-year non-deliverable forward markets now have the midpoint falling almost 3 percent to 7.1 over the next 12 months. That dollar pressure and the U.S. Treasury and global bond market selloff on speculation about Trump's reflation policies is prompting another exit from emerging markets, with regional Asia bourses down across the board on Monday. A bounceback in Brent crude back above $47 on hopes for an OPEC supply cut next week only added to that reflation theme.

Upcoming events/data/ themes for market reports on Monday:

- Europe corp events: Mitie (Brexit watch), Diploma (LSE: DPLM.L - news) , Hellenic Exchanges (Athens: 1111350.AT - news) , Kingfisher (Amsterdam: KF6.AS - news) (Brexit watch)

- Riksbank executive board meeting

- Belgium auctions OLOs, Nov consumer confidence

- Nigeria Q3 GDP

- Ghana interest rate decision

- Poland Oct industry output, PPI, retail sales

- US Treasury auctions 2-year notes (Editing by Sonya Hepinstall)