Stocks rose in Europe and U.S. equity futures turned higher at the start of a week that could be pivotal for the global trade outlook. The dollar strengthened for an eighth day.
The Stoxx Europe 600 climbed with all 19 sectors in the green and contracts on the S&P 500, Dow Industrials and Nasdaq Composite all reversed an earlier loss. Earlier, equities rallied in China as exchanges reopened after a one-week holiday. The rest of the region traded mixed, with shares climbing in Hong Kong, falling in Sydney and edging higher in South Korea. Japan is shut for a holiday. Yields on Treasuries and most European sovereign bonds edged higher, while the pound extended its decline after the U.K. economy unexpectedly shrank in December.
Trade tensions are ratcheting up as investors evaluate the prospects for a U.S.-China deal before the March 1 deadline for higher tariffs, as warnings mount that the dispute is curbing the global economic expansion and denting corporate profits. Chinese Vice Premier Liu He will join Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer in Beijing for high-level talks this week. Washington is also in focus, with the U.S. government potentially headed for another shutdown as political tensions flare between Congress and the president.
“We still have concerns about global growth and that centers on those U.S.-China negotiations,” Kerry Craig, global market strategist at JPMorgan Asset Management, told Bloomberg TV from Melbourne. “We’re unlikely to see any massive moves this week saying we’re going to get a deal on that.”
Elsewhere, WTI oil futures slipped toward $52 a barrel, while gold headed for its first drop in three sessions. The Swiss franc swooned almost 1 percent at the start of Asia trading Monday in a mini-recurrence of the “flash crash” that roiled FX markets early last month.
Here are some key events coming up:
Earnings season continues with reports from companies including Michelin, Nissan, Cisco, Vivendi, Nvidia, Nestle, Coca-Cola and Credit Suisse.Sweden’s Riksbank is expected to keep interest rates at minus 0.25 percent on Wednesday after the first increase in more than seven years in December.Data Wednesday is expected to show U.S. consumer prices rose 0.1 percent in January, after falling 0.1 percent in December.If no deal is reached on the U.S-Mexico border wall, parts of the federal U.S. government may shut down again later this week when stopgap government funding expires.
These are the main moves in markets:
The Stoxx Europe 600 Index rose 0.9 percent as of 9:40 a.m. London time.Futures on the S&P 500 Index rose 0.4 percent, the biggest advance in a week.The Shanghai Composite Index surged 1.4 percent, hitting the highest in almost 10 weeks.The MSCI World Index of developed countries rose 0.1 percent.
The Bloomberg Dollar Spot Index rose 0.2 percent with its eighth straight advance.The euro fell 0.1 percent to $1.1312.The Swiss franc fell 0.2 percent to $1.0026.The British pound fell 0.3 percent to the weakest in three weeks.The Japanese yen decreased 0.5 percent to the weakest in more than six weeks on the largest dip in more than a week.
The yield on 10-year Treasuries rose one basis point to 2.65 percent, the first advance in a week.Germany’s 10-year yield jumped two basis points to 0.11 percent, the first advance in a week.Italy’s 10-year yield fell less than one basis point to 2.957 percent, the first retreat in a week.
Gold decreased 0.5 percent to $1,307.52 an ounce.West Texas Intermediate crude fell 0.6 percent to $52.40 a barrel.LME nickel rose 0.2 percent to $12,600 per metric ton.LME copper sank 0.8 percent to $6,163.00 per metric ton.
–With assistance from Sarah Ponczek and Adam Haigh.
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