This is CNBC's live blog covering European markets.

European stock markets opened higher Friday, after U.S. lawmakers passed a bill to raise the debt ceiling and cap government spending for two years, days before the default deadline.

The Stoxx 600 index was up 0.5% shortly after the open, as it climbed further from the two-month low hit on Wednesday. Mining stocks led gains, up 1.8%, while oil and gas climbed 1.1% ahead of the June 4 OPEC+ meeting.

The Fiscal Responsibility Act cleared a Senate vote late Thursday, after passing the House of Representatives on Wednesday.

The ongoing drama has only slightly rattled markets in recent weeks, and focus now returns to the outlook for the U.S. economy, recession risk, and whether the Federal Reserve will raise, hold or even look at beginning to cut interest rates.

Recent comments from officials have indicated the central bank may opt to skip another hike at its June meeting. However, the picture is complicated by continued strength in U.S. data., including in consumer spending and manufacturing orders. Friday will see the release of a closely-watched labor market report.

In Europe, a significant fall in euro zone inflation to its lowest level since Feb. 2022 on Thursday was not enough to comfort European Central Bank President Christine Lagarde, who said the 6.1% figure was still "too high" and that the hiking cycle needed to continue until it was clear inflation would come down to its 2% target in a "timely manner."

ECB officials have given firm hints it will raise rates again this month, but economists say the outlook for July and September is more uncertain.

Asia-Pacific markets were higher Friday, as consumer and real estate stocks powered Hong Kong's Hang Seng index 3.66% higher. U.S. stock futures were also higher.

European markets: Here are the opening calls

European markets are seen opening higher Friday, according to data from IG.

The U.K.'s FTSE 100 looks set to open 20.7 points higher at 7,518; Germany's DAX 91.5 points higher at 15,942; France's CAC 37.4 points higher at 7,169; and Italy's MIB up 115 points to 26,697.

— Jenni Reid

Senate passes bill to raise debt ceiling, preventing default

The Senate passed a bill Thursday night to raise the debt ceiling, sending it to President Joe Biden's desk.

He is expected to sign the legislation Friday, preventing what would have been the first-ever U.S. sovereign debt default.

The House-approved compromise bill passed the Senate by a 63-36 margin, garnering sufficient bipartisan support to overcome the chamber's 60-vote threshold to avoid a filibuster.

U.S. stock futures were slightly higher ahead of the vote and held at those levels after the bill was passed. Futures tied to the Dow Jones Industrial Average were up about 30 points.

— Christine Wang, Christina Wilkie

Oil prices edge slightly higher ahead of OPEC+ meeting

Oil prices traded slightly above the flatline as traders look toward an OPEC+ meeting this weekend.

Global benchmark Brent inched 0.2% lower at $74.44 a barrel Friday, while the U.S. West Texas Intermediate futures was 0.24% down to $70.27 per barrel.

"If [OPEC] don't do anything, we could really see prices sell off, we've seen them selling off this week," said Kpler's lead oil analyst Matt Smith.

The oil cartel is not likely to deepen output cuts in the upcoming meeting, Reuters reported citing sources from the alliance.

Smith forecasts that Brent prices could slip to $70 per barrel should OPEC maintain the status quo.

"Oil prices fell sharply in May, with the WTI benchmark dropping below USD70/b," HSBC wrote in a report dated June 1. The bank noted that the decline came despite the previously announced OPEC+ production cuts coming into effect during the month.

Aside from the uncertainty that had been swirling around the U.S. debt ceiling standoff, China's subdued growth indicators also weighed on prices, the report noted.

—Lee Ying Shan

CNBC Pro: This stock is a ‘key beneficiary’ of Nvidia’s A.I. opportunity, says Morgan Stanley

Global artificial intelligence revenue will reach $180 billion this year and grow to nearly $2 trillion by 2030 — and it will be a key driver of semiconductor revenue, Morgan Stanley says.

Investors are already buying into the AI buzz. Nvidia shares surged last week after it reported earnings that blew past expectations.

Morgan Stanley names one stock that will be a "key beneficiary of NVDA's AI opportunity."

CNBC Pro subscribers can read more here.

— Weizhen Tan

Friday jobs data will 'underline' Fed challenges, economist says

Data on nonfarm payrolls, the unemployment rate and hourly wages due Friday will highlight the challenges the Fed faces heading into the June policy meeting, according to Joe Davis, chief economist at Vanguard.

Economists polled by Dow Jones expected non-farm payrolls to rise by 190,000 in May, which would be a smaller monthly increase than the 253,000 added in April. They forecast an unemployment rate of 3.5%, slightly higher than the 3.4% seen in April.

Hourly wages are expected to grow 0.3% on a monthly basis and 4.4% compared with the same month a year ago. In April, wages rose 0.48% month over month and 4.45% on an annualized basis.

"We believe tomorrow's labor market report will underline the challenges the Fed continues to face in their push to drive inflation back towards target," Davis said. "We remain of the view that they should raise rates in June to enforce their resolve before pausing for some time to assess the impact on macro conditions, though the more important aspect of our perspectives remains the Fed being on hold through at least the end of the year."

"Indications of continued labor market tightness in tomorrow's report would provide further support for these views," he added.

— Alex Harring