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Euro slides, French stocks fall on political uncertainty

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Chinese stocks boosted by robust manufacturing surveys

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Trump buoys dollar with tariff threat on BRICS

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Japan bond yields hit 16-year high on BOJ rate hike bets

(Updates throughout to capture mid-morning European trading;

refreshes prices at 0924 GMT)

By Amanda Cooper

LONDON, Dec 2 (Reuters) - The euro fell on Monday as a

threat from France's far right to collapse its government kept

European markets under pressure, while tech stocks lifted global

shares and the dollar firmed in a key week for the U.S. interest

rate outlook.

The U.S. currency got an additional boost from U.S.

President-elect Donald Trump at the weekend, who warned BRICS

emerging nations against trying to replace the greenback with

any other currency.

France's far-right National Rally (RN) party has given

Prime Minister Michel Barnier until Monday to yield to the

party's demands for concessions in his proposed budget or face

the possibility of RN backing a no-confidence motion against his

government, which would lead to its collapse.

The euro headed for its biggest one-day drop in a

month, while French stocks fell sharply, pushing the Paris CAC

40 down by 1% on the day.

The country's bonds did not come under fire, although they

did lag the rest of the fixed income market, meaning that the

premium that France must pay to borrow from the international

markets rose.

"France is not great. It doesn't make you want to buy,

basically. So that's (affecting) the equity side and maybe the

euro side, but the idea that France is on the verge of having

this major debt stress, for now, is not what we're seeing,"

Lombard Odier economist Samy Chaar said.

The premium, or spread that investors demand to hold French

rather than German sovereign bonds - widely considered the

benchmark for Europe - burst above 80 basis points for the first

time since the 2012 euro zone debt crisis back in June.

That resulted from a dismal result in European parliamentary

elections prompted President Emmanuel Macron to call snap

elections that resulted in Barnier's fragile coalition

government.

On Monday, that spread was around 83 bps, some 3 bps wider

on the day but below last week's 12-year high of 90 bps.

The euro was down 0.6% at $1.0513 against the dollar.

If the Barnier government falls, broader downward pressure

on the euro would quickly re-assert itself, including against

the Swiss franc, said Paul Mackel, global head of FX research at

HSBC.

DOLLAR HOLDS FIRM

Beyond France, global stocks edged up, leaving the MSCI

All-World index up 0.1%, while U.S. stock

futures were down 0.1-0.2% , suggesting a modestly

lower start following Friday's holiday-shortened session in

which the major indices scored record-high closes

.

The Federal Reserve is in sharp focus and Friday's monthly

payrolls report could be the deciding factor when policymakers'

consider whether or not to cut rates again on Dec. 18.

A number of Fed officials are due to speak this week,

including Fed Chair Jerome Powell on Wednesday. Traders put the

odds of a quarter-point reduction at about 66%.

That has left the dollar index, which measures the

currency against six others, up 0.25% at 106.31, having gained

1.8% in November.

In Asia, Chinese shares got an additional boost from a

robust reading in a private manufacturing survey on Monday.

Hong Kong's Hang Seng inched up 0.16%, while mainland

Chinese blue chips rose 0.6%.

The yen, meanwhile, weakened 0.2% to 150.065, but

remained near Friday's six-week high of 149.47.

In cryptocurrencies, ether hit a near six-month high

of $3,762.20 earlier in the day but pared those gains, falling

2.5% to $3,610. Bitcoin was last down 2.7% at $95,173,

still in sight of late November's record high at $99,830.

Gold sank 0.7% to $2,635 an ounce, under pressure

from the strong dollar, after sliding more than 3% in November,

its worst monthly performance since September 2023.

Oil prices rose after the Chinese manufacturing data, and as

Israel resumed attacks on Lebanon despite a ceasefire agreement,

which stirred up concern about potential supply disruption from

the region.

Brent crude futures were up 0.8% at $72.42 a barrel,

while U.S. crude was up 0.78% at $68.54.

(Additional reporting by Kevin Buckland in Tokyo and Ankur

Banerjee in Singapore; Editing by Kate Mayberry, Shri

Navaratnam, Ed Osmond and Jan Harvey)