* France's CAC down 0.9 pct, lags Europe
* Metals and mining sector up as steel stocks rally
* Software AG top gainer after results
* European earnings kick off in earnest next week (Recasts, adds quote and detail, updates prices)
By Kit Rees
LONDON, April 21 (Reuters) - French blue-chip stocks underperformed other European benchmark indexes on Friday as investors retreated from risky bets ahead of the too-close-to-call first round of France's presidential election.
The CAC 40 fell 1 percent, while the pan-European STOXX 600 index was down 0.1 percent.
"So far markets have been pretty sanguine in the face of the (French) presidential election, which was flagged as one of the potential banana skins for markets in this year," Hargreaves Lansdown senior analyst, Laith Khalaf, said.
"There may be a bit of political weariness among investors, but also they may just be thinking that, actually, they’re not going to place market bets based on political events, and that would be an entirely sensible strategy," he said.
Among French standout movers, Danone was the biggest faller on the CAC 40, down 2.2 percent after reporting first-quarter sales figures. French banks Societe Generale and BNP Paribas extended the previous session's gains, both rising about 1 percent.
Earnings and deal-making drove stock price moves elsewhere, including a jump of 7 percent for Software AG, making the shares the STOXX 600's top gainer, after reporting first-quarter results. Software's quarterly core profit declined less than expected.
Tech sector peer ASM International rose 3.2 percent after Natixis raised its target price.
Europe's earnings season kicks off in earnest next week with Credit Suisse, UBS and SAP among those reporting results.
European first quarter earnings are expected to increase 7.2 percent from the first quarter of 2016, according to Thomson Reuters I/B/E/S data. Excluding the energy sector, this would be a rise of 2.9 percent.
Engineering firm WS Atkins gained 5.1 percent after Canada's SNC-Lavalin Group said it would buy the firm for C$3.6 billion, firming up this month's indicative offer.
Among other standouts, Orkla was the biggest faller on the STOXX 600 after going ex-dividend, while a downgrade from Panmure weighed on SSP Group's shares.
Basic resources stocks were the biggest sectoral gainers, up 1.4 percent as steel miners rallied, with ArcelorMittal and Outokumpu up 2.6 percent and 1.7 percent respectively. Iron ore miner Rio Tinto also rose, as an advance for Chinese steel companies outweighed the impact of a U.S. trade investigation into China.
Oil stocks were also a drag, falling 0.5 percent as crude prices retreated. (Editing by Helen Reid and Louise Ireland)