French Markets Face Volatility as Unrest Deepens Budget Crisis

French bond yields climbed to 24-year highs on Monday, with risk spreads against German debt approaching recent peaks. The unrest has intensified concerns over political stasis, complicating the government's ability to navigate a precarious budget process ahead of next April’s presidential elections. With little public funding available to appease protesters, the economic outlook for the region remains downbeat. French banking stocks have borne the brunt of the selloff, underperforming broader European indexes.

Global markets are simultaneously grappling with broader shifts in the tech sector and energy volatility. In Asia, chip-heavy indexes faced renewed pressure, highlighted by a 30% drop in the market debut of data center firm Elice. This cooling interest in "neocloud" infrastructure follows recent declines in US-based CoreWeave. Meanwhile, Brent crude prices are holding above $111 per barrel due to Middle East tensions, while European natural gas prices have hit four-year highs, adding further strain to the continent's economic recovery.