(Updates to U.S. market open)

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U.S., European stocks edge up as French government ditches savings measure

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Trump buoys dollar with tariff threat on BRICS

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China stocks boosted by robust manufacturing surveys

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Japan bond yields hit 16-year high on BOJ rate hike bets

By Lawrence Delevingne and Amanda Cooper

BOSTON/LONDON, Dec 2 (Reuters) - Stocks in Europe steadied on Monday after the French government said it would scrap a proposed budget reform as a concession to the far-right, lifting overall investor sentiment and putting U.S. equities on track for a modest rise as Wall Street began December trading.

The French administration said on Monday there would be no change to medication reimbursements in 2025, ditching earlier plans to tighten the system as part of a wider savings push.

European shares , helped by a bounce-back in France

, forged higher and was last up about 0.5% on the day.

On Wall Street, the Dow Jones Industrial Average was little changed at 44,933, the S&P 500 rose 0.21%to 6,044 and the Nasdaq Composite rose 0.56%, to 19,324.

"Clearly, the financial issues aren't going to go away, but nor are they going to bring the house down in short order," IG Markets chief market analyst Chris Beauchamp said. "It's understandable - the risk-on move from key assets, hoping that this might lead to some kind of agreement."

The euro itself gained little respite, down 0.8% to $1.049, as the dollar got a boost from U.S. President-elect Donald Trump at the weekend, who warned BRICS emerging nations against trying to replace the greenback with any other currency.

The euro has lost some 14% in value over the last three months, in part because of concern that the health of the euro zone economy might require the European Central Bank to deliver deeper interest-rate cuts than previously expected.

France's National Rally (RN) had given Prime Minister Michel Barnier until Monday to yield to the far-right party's demands for concessions in his proposed budget or face the possibility of it backing a no-confidence motion.

In June, the premium, or spread that investors demand to hold French rather than German sovereign bonds - widely considered the benchmark for Europe - burst above 80 basis points for the first time since the 2012 euro zone debt crisis.

That spike resulted from a dismal result in European parliamentary elections which prompted President Emmanuel Macron to call a snap vote, resulting in Barnier's fragile coalition. On Monday, the spread was around 81 bps, some 1 bp wider on the day but below the session high of 86 bps and below last week's 12-year high of 90 bps.

"Heightened political uncertainty could also play a role at the margin in keeping alive market expectations for larger 50 bps ECB rate cut this month although the hard economic data is not fully supportive," MUFG currency strategist Lee Hardman said.

DOLLAR FIRM

Beyond France, global stocks edged highe, leaving the MSCI All-World index up about 0.3%.

The Federal Reserve is in sharp focus and Friday's monthly payrolls report could be the deciding factor when policymakers consider whether or not to cut rates again on Dec. 18.

A number of Fed officials are due to speak this week, including Fed Chair Jerome Powell on Wednesday. Traders put the odds of a quarter-point reduction at about 60%.

That has left the dollar index , which measures the currency against six others, up 0.4% at 106.47, having gained 1.8% in November.

In Asia, mainland Chinese shares closed up 0.8%, following a robust reading in a private manufacturing survey on Monday.

The yen , meanwhile, was steady near Friday's six-week high of 149.47.

Gold dipped 0.25% to $2,646 an ounce, under pressure from the strong dollar, after sliding more than 3% in November, its worst monthly performance since September 2023.

Oil prices rose after the Chinese manufacturing data, and as Israel resumed attacks on Lebanon despite a ceasefire agreement, which stirred up concern about potential supply disruption from the region.

Brent crude and U.S. futures were both more than 1% at $72.61 a barrel and $68.82, respectively.

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(Reporting by Lawrence Delevingne in Boston and Amanda Cooper in London. Additional reporting by Kevin Buckland in Tokyo and Ankur Banerjee in Singapore; Editing by Kate Mayberry, Shri Navaratnam, Ed Osmond, Jan Harvey, Alexander Smith and Gareth Jones)

((lawrence.delevingne@thomsonreuters.com))