Markets Steady Amid Political Turmoil and Fed Rate Cut Expectations

European stocks remained positive due to anticipated U.S. Federal Reserve rate cuts, despite political instability in France following the government's collapse. President Macron seeks a new prime minister after Francois Bayrou's removal. Meanwhile, markets speculate on potential Fed rate cuts as global political turmoil influences currency and bond markets.

European stocks persisted in a positive stance on Tuesday, buoyed by hopes for a rate cut from the U.S. Federal Reserve, which offset the uncertainties arising from the French government's collapse. The STOXX 600 index in Europe edged 0.1% higher, while Asian shares gained 0.9%, showcasing global market resilience.

France's political scene saw upheaval as President Emmanuel Macron searches for his fifth prime minister in two years following Francois Bayrou's ousting over controversial budget plans. While calls for early elections swirl, analysts suggest avoiding a snap poll would stabilize markets despite ongoing fiscal challenges.

A global eye remains on forthcoming Fed meetings where weak U.S. jobs data fuels rate cut expectations. Commodities markets also reacted, with oil prices rising after OPEC+'s production goals announcement, and gold reaching record highs amid monetary policy speculation.

(With inputs from agencies.)