Stocks were mixed on Monday as investors weighed fresh developments in the outlook for monetary policy and a new round of corporate earnings. Oil gained amid tensions in the Persian Gulf.
The Stoxx Europe 600 Index was little changed, buoyed by energy and mining shares, while U.S. equity futures ticked higher. Stocks slid across Asia, with traders in Hong Kong watching escalating tensions there, though China’s new stock venue for technology startups was a bright spot as all 25 stocks rose on their debut. Treasuries and the dollar were steady after traders pared bets the Federal Reserve will slash rates by a half-point this month, following comments from St. Louis Fed President James Bullard on Friday.
This week sees the earnings season ramp up, while the Fed is in a blackout period with regard to policy communications ahead of next week’s policy decision. Trade remains in the picture as Chinese state media reported face-to-face negotiations between the top Chinese and U.S. trade negotiators could happen soon.
“The start of earnings season has been very positive, but the price action on the major indexes has not been,” said Edward Moya, a strategist at Oanda Corp. “It appears markets are waiting to break and this could be the week that happens.”
Elsewhere, gold edged up while emerging-market stocks slid.
Here are some key events coming up:
Earnings season rolls on with companies including: Amazon.com, Alphabet, Unilever, Caterpillar, Coca-Cola, McDonald’s and Boeing.U.K. Prime Minister Theresa May’s successor is announced on Tuesday, with Boris Johnson expected to become the new Conservative leader and PM.Thursday brings the European Central Bank policy decision. Economists widely expect officials to signal their readiness to cut interest rates and potentially broaden stimulus. Some see the chance of an immediate rate cut. ECB President Mario Draghi holds a briefing afterward.
These are the main moves in markets:
Stocks
Futures on the S&P 500 Index increased 0.2% as of 8:27 a.m. London time.The Stoxx Europe 600 Index decreased less than 0.05%.The Shanghai Composite Index declined 1.3%, the lowest in more than five weeks on the largest drop in two weeks.The MSCI Emerging Market Index declined 0.4%.
Currencies
The Bloomberg Dollar Spot Index advanced 0.1%.The euro dipped less than 0.05% to $1.1217.The British pound sank 0.2% to $1.2481.The onshore yuan climbed less than 0.05% to 6.879 per dollar.The Japanese yen fell 0.2% to 107.89 per dollar.
Bonds
The yield on 10-year Treasuries sank one basis point to 2.05%.The yield on two-year Treasuries jumped one basis point to 1.83%.Germany’s 10-year yield was unchanged at -0.32%, the lowest in almost two weeks.Britain’s 10-year yield declined less than one basis point to 0.73%, the lowest in almost two weeks.Japan’s 10-year yield dipped less than one basis point to -0.135%, reaching the lowest in almost two weeks on its sixth straight decline.
Commodities
West Texas Intermediate crude advanced 1.2% to $56.29 a barrel, the largest gain in more than a week.Iron ore dipped 2.7% to $113.57 per metric ton, the lowest in more than a week on the biggest decrease in more than two weeks.Gold climbed 0.1% to $1,427.10 an ounce.