Stock markets diverged Monday as a deepening political crisis in France sent Paris into a tailspin while a new Japanese ruling party leader buoyed shares in Tokyo.

Gold pushed ever closer to $4,000 an ounce as the US government shutdown and expected interest cuts from the Federal Reserve boosted the precious metal's attractiveness.

The euro fell against main rivals and French borrowing costs spiked as Sebastien Lecornu, who had been prime minister for less than a month, resigned just 14 hours after naming a largely unchanged cabinet.

France's "fractured parliament is making it nearly impossible to pass a budget that reduces the fiscal deficit", said Jack Allen-Reynolds, deputy chief eurozone economist at Capital Economics.

"With government borrowing running at more than five percent of

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