European stock markets are set to open higher on Tuesday, December 3, 2024, as investors look ahead to a week of political instability in France. Key stock indices across Europe, including the U.K.’s FTSE 100, Germany’s DAX, France’s CAC 40, and Italy’s FTSE MIB, are projected to rise slightly. Investors will also be monitoring economic data releases, including U.K. retail sales and Spanish unemployment figures.

Political Instability in France: The French financial markets are expected to see volatility on Tuesday as Prime Minister Michel Barnier faces significant political opposition. Barnier used special constitutional powers to pass a controversial budget bill without a parliamentary vote, a move that has sparked outrage from opposition parties. Both left-wing and right-wing parties in France have voiced their intent to support a no-confidence vote aimed at bringing down Barnier’s minority government. This vote could take place as early as Wednesday, adding an extra layer of uncertainty for investors.

On Monday, the French CAC 40 index experienced a turbulent session, starting off lower before flipping into positive territory and then finishing in negative territory again. This choppy performance reflects the market’s sensitivity to the ongoing political uncertainty in France.

European Stock Markets' Outlook: Across the continent, the FTSE 100 in the U.K. is expected to rise by 18 points, reaching 8,322. Meanwhile, Germany’s DAX is forecast to climb 15 points to 19,922, and Italy’s FTSE MIB is predicted to gain 43 points, reaching 33,601. The French CAC 40 is likely to rise by 29 points, hitting 7,245, despite the domestic political turmoil.

Investors are also keeping an eye on several economic indicators. U.K. retail sales data will provide insight into consumer spending in one of Europe’s largest economies. Additionally, Spanish unemployment figures will offer clues about labor market conditions in the eurozone.

Global Market Trends: In Asia, markets traded higher, reflecting positive momentum from Wall Street. The S&P 500 and Nasdaq Composite both hit new records in the previous trading session, spurring optimism in global markets. U.S. stock futures were relatively flat on Monday night, with investors waiting for further cues from the ongoing geopolitical and economic developments.

Conclusion: European markets are expected to open higher on Tuesday as investors navigate both regional economic data and political developments in France. The political turmoil surrounding Prime Minister Barnier could lead to further volatility in French markets, while global optimism driven by Wall Street will likely provide support for broader European indices.