European markets opened higher on Monday, buoyed by positive sentiment from global stock futures. The financial community would pay attention to this week US CPI and there is growing optimism on a more aggressive rate cut by the Federal Reserve. After the first hour of trading, major indices across the region showed solid gains, driven by sector-wide strength and a lift from the energy markets. The FTSE 100 climbed to 8,229.42, advancing 0.59%, while France’s CAC 40 increased by 0.56% to 7,393.52. Germany’s DAX led the European markets, rising 0.70% to 18,407.95, as strength in industrials and technology stocks bolstered the index. Spain’s IBEX 35 also gained 0.56%, reaching 11,236.00, while the Euro Stoxx 50 advanced 0.77% to 4,774.35.
Asian equity markets stumbled on Monday, weighed down by concerns over U.S. and Chinese growth prospects. Despite the bleak mood, U.S. and European stock futures posted a slight recovery, while bond yields eased from recent lows. China’s latest consumer price data underscored the ongoing deflationary pressures gripping the global economy. Producer prices fell 1.8% year-on-year in August, deeper than analysts’ predictions of a 1.4% decline. Consumer inflation, too, came in below forecasts at 0.6%, with food prices accounting for nearly all of the increase, and goods prices rising just 0.2%, indicating tepid domestic demand. The weakness in China took a toll on its stock market, with the benchmark blue-chip index shedding 1% while Japan’s Nikkei was also hit hard, particularly its tech sector, losing another 0.8%. Meanwhile, the broader MSCI index of Asia-Pacific shares outside Japan slipped by 1.2%, reflecting the cautious mood across the region.
Commodities showed mixed results in early trading, with crude oil rising 1.39% to $68.61 per barrel, as supply concerns pushed prices higher. However, natural gas dropped 3.47% to $2.196, driven by oversupply concerns in Europe. Gold remained steady, down 0.05% at $2,523.40.
In the U.S. futures market, the major indices continued to show strength, signaling a positive opening on Wall Street. Dow futures were up 208 points, or 0.51%, to 40,615.00, while Nasdaq 100 futures rose 0.83% to 18,611.25. S&P 500 futures followed, gaining 33.50 points, or 0.62%, to 5,453.00.
In the currency and bond markets, the U.S. dollar showed strength against the euro and pound. The EUR/USD pair fell 0.21% to 1.1060, while GBP/USD dipped 0.15% to 1.3103. The USD/JPY pair climbed 0.67% to 143.19. Meanwhile, U.S. Treasury yields edged lower, with the 5-year Treasury yield down 5.1 basis points to 3.489%, and the 10-year yield decreasing by 2.1 basis points to 3.71%. The 30-year Treasury yield remained relatively flat at 4.02%.
Bitcoin edged up slightly by 0.04% to trade at $55,135, continuing its steady momentum as investors cautiously re-entered the cryptocurrency market.
