Europe stocks extend rebound; France lags on fiscal concerns

European equities rose at Monday's open, building on a recovery driven by positive momentum from Wall Street and Asia.

• Eurostoxx +0.5%
• Germany DAX +0.5%
• France CAC 40 +0.2%
• UK FTSE +0.6%
• Spain IBEX +0.7%
• Italy FTSE MIB +0.7%

While gains were widespread, France's CAC 40 underperformed again. The index climbed, though the more modest advance shows investors remain wary of the nation's fiscal challenges.

French sovereign bonds have faced strong selling pressure in recent days as markets doubt the government's ability to execute its budget plans and stabilise the debt trajectory. This pushed the yield spread between 10-year French and German bonds to 150 basis points last Friday, the largest gap since 2012.

That situation continues to represent a significant risk for European assets, analysts note.

In other markets, US equity futures pointed slightly higher, with S&P 500 and Nasdaq futures each gaining about 0.2%. That extends a tech-driven rally on Wall Street, where the Nasdaq closed at a fresh record overnight.

However, caution is warranted, as the early gains may not signal sustained strength.

Long-term Treasury yields remain near multi-decade highs, keeping rate pressure in focus. In Europe, the central question is whether fiscal strain in France stays contained or spreads more noticeably across the region.