Stocks rose in Europe following a mixed session in Asia at the start of a week that could be pivotal for the global trade outlook. Oil fell, while the dollar strengthened for an eighth day.
The Stoxx Europe 600 climbed with all sectors advancing, while futures on the S&P 500, Dow and Nasdaq gauges were steady. Equities rallied in China as exchanges reopened after a one-week holiday. Shares climbed in Hong Kong, fell in Sydney and edged higher in South Korea. Japan is shut for a holiday. A dollar index rose again, and the pound weakened as U.K. premier Theresa May sought to buy time to renegotiate her Brexit agreement. Treasuries and European sovereign bonds were little changed.
Investors are focused on the prospects for a U.S.-China trade deal before the March 1 deadline for higher tariffs, while 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 trade talks this week. In Washington, the U.S. government could be 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 (JPM)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 declined 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 Asian trade 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 (CSCO), Vivendi, Nvidia (NVDA), Nestle, Coca-Cola (KO) 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 0.5 percent as of 8:08 a.m. London time. Futures on the S&P 500 Index fell less than 0.05 percent. The Shanghai Composite Index surged 1.4 percent, hitting the highest in almost 10 weeks with the first advance in more than a week and the largest jump in more than three weeks. The MSCI Asia Pacific Index rose less than 0.05 percent. The MSCI World Index of developed countries rose 0.1 percent to 2,021.90.
The Bloomberg Dollar Spot Index rose 0.1 percent to 1,193.29. The euro fell less than 0.05 percent to $1.132. The Swiss franc fell less than 0.05 percent. The Japanese yen fell 0.2 percent to the weakest in more than six weeks on the largest fall in a week. The onshore yuan declined 0.6 percent to 6.777 per dollar and the biggest decrease in more than a week.
The yield on 10-year Treasuries rose one basis point to 2.64 percent, the first advance in a week. Germany’s 10-year yield increased one basis point to 0.10 percent, the first advance in a week. Italy’s 10-year yield gained two basis points to 2.983 percent, hitting the highest in two months with its fifth consecutive advance.
Gold fell 0.3 percent to $1,310.94 an ounce. West Texas Intermediate crude fell 1.3 percent to $52.05 a barrel. LME nickel fell 0.3 percent to $12,530 per metric ton. LME copper sank 1.1 percent to $6,140.00 per metric ton.