European stocks slide as French debt crisis rattles markets

European stock markets fell sharply on Thursday, with the Stoxx 600 index down 1%, as a worsening French debt crisis spread tension across the eurozone. Milan was among the worst performers, with the Italian spread widening to 124 points and Brent crude oil surging above $112 a barrel. The yield on French 10-year bonds exceeded 5.1%, the highest since 2002, pushing the spread over German Bunds to 170 basis points. This follows concerns over France's public finances, political uncertainty, and social tensions ahead of presidential elections, with parliament debating a 2027 budget plan requiring €54 billion in savings. Italy's 10-year yield rose to 4.63%, increasing borrowing costs, while energy prices spiked with gas above €89 per megawatt-hour. These developments reignite inflation fears, potentially prompting further central bank rate hikes and keeping pressure on bond yields.