(Updates to late morning U.S. trading)

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Bitcoin surges to fresh milestone

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World stocks hold near record highs

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French government collapses, euro holds up

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Dollar dips, Treasury yields steady

By Lawrence Delevingne and Dhara Ranasinghe

BOSTON/LONDON, Dec 5 (Reuters) - Bitcoin broke above

$100,000 on Thursday as investors bet on a friendly U.S.

regulatory shift, while world stocks touched fresh record highs

with sentiment bolstered by upbeat comments on the economy from

Federal Reserve chief Jerome Powell.

France's government lost a confidence vote late on Wednesday for

the first time since 1962, with the far-right and leftist

lawmakers joining forces to topple Michel Barnier's government.

The move had been widely anticipated by investors, so the euro,

French stocks and bonds were largely steady on Thursday. Barnier

officially resigned on Thursday.

U.S. stocks ticked down in morning trading, a day after all

three major U.S. stock indexes scored record closing highs,

helped by the comments from Fed Chair Powell.

The Dow Jones Industrial Average fell 0.21%

to 44,920, the S&P 500 dropped 0.10% to 6,080.18 and the

Nasdaq Composite lost 0.13% to 19,709.

Powell said the economy was stronger than it had appeared in

September when the central bank began cutting interest rates,

allowing policymakers to potentially be a little more cautious

in reducing rates further.

Francois Savary, chief Investment Officer at Genvil Wealth

Management, said a fall in U.S. Treasury yields in recent weeks,

relatively robust U.S. data and Powell's latest comments were

supporting sentiment in equity markets.

"But there is a risk to the euphoria," he added.

"Everything is going the right way, right now, but wait for

January, (U.S. President-elect Donald) Trump will take power and

have to implement economic plans and people will realise that

this could have some potential inflationary impact."

BITCOIN IN THE SUN

It was bitcoin's day to shine, as the cryptocurrency hit

the $100,000 mark and was last trading around 4% higher on the

day, near $102,000.

Its latest surge followed Trump saying he would nominate Paul

Atkins, who is pro-crypto and pro-deregulation, to run the

Securities and Exchange Commission.

"At the end of the day, it's just a number," said Geoff

Kendrick, global head of digital assets research at Standard

Chartered.

"But the reality is we've been able to get to this level

because the industry has become institutionalised this year

particularly - and that's mostly the ETF inflows," he said,

referring to exchange traded funds approved earlier this year.

U.S. rate-cut optimism supported sentiment across broader

markets.

Over the past week and a half, markets have all but priced in an

extra U.S. rate cut for 2025 and the implied chance of a cut in

December has lifted from even to around 70%.

Earlier this week, Fed Governor Christopher Waller had said he

was leaning towards a cut in December.

The closely watched U.S. ISM survey showed services sector

activity slowed in November after posting big gains in recent

months.

Benchmark 10-year Treasury yields edged up after

falling the previous day.

With eyes on monthly U.S. employment data on Friday, new data on

Thursday showed that the number of Americans filing new

applications for unemployment benefits increased moderately last

week, suggesting that the labor market continued to steadily

cool.

The dollar weakened against major currencies, down about

0.5%, leaving the euro up 0.6% at $1.057.

The risk premium investors demand to hold French debt over

German Bunds dropped further away from its highest levels in

over 12 years on Thursday after the widely expected government

collapse. French stocks rallied to their highest levels in over

three weeks.

"A lot of bad news was priced in, it was obvious that we

were heading towards the fall of the government," said Savary of

Genvil Wealth Management.

In neighbouring Germany, which is also grappling with political

paralysis after its government fell in late November, the DAX

blue-chip index rattled to another record high, making

it the best-performing major index in Europe this year, with a

gain of 21%.

Germany holds elections in February and the hope among

investors is for the new government to take measures to

stimulate the economy and loosen some rules that cap state

borrowing.

Financial markets in South Korea were broadly steady after

President Yoon Suk Yeol's failed attempt to impose martial law

late on Tuesday triggered volatility and a political crisis.

Oil prices edged higher ahead of an OPEC+ meeting later in

the day. The Organization of the Petroleum Exporting Countries

and its allies in OPEC+ are likely to extend their latest round

of oil production cuts, sources told Reuters.

U.S. crude gained 0.44% to $68.84 a barrel and Brent

rose to $72.65 per barrel, up 0.46% on the day.