Stocks in Europe gained; Dollar climbed against its major peers 

Stocks in Europe gained along with U.S. equity-index futures, while Asian benchmarks were mixed as investors weighed more signs of economies reopening around the world against the rise in U.S.-China tensions.

Health-care and leisure shares led the advance in the Euro Stoxx Index. Bayer jumped after Bloomberg reported it had reached agreements to resolve some Roundup-related lawsuits. Contracts on all three major U.S. gauges rose. Hong Kong shares held Friday’s slide, the biggest in almost five years, following police clashes with protesters marching against China’s move to crack down on dissent. Stocks climbed in Tokyo, Sydney and Seoul, and fluctuated in Shanghai. Volumes may be light with holidays in the U.S., U.K. and Singapore. Treasuries weren’t trading, and futures on the 10-year note were little changed.

The dollar climbed against its major peers, while oil held above $33 a barrel in New York. China set its daily yuan reference rate at the weakest level since 2008 after the increasing tensions drove the currency to a seven-month low on Friday. A benchmark of emerging-market stocks headed for its first gain in three sessions.

On the virus front, Japan’s government is expected to lift the state of emergency in Tokyo and its surrounding regions later Monday, while more Australian children returned to schools and a hard-hit region in northern Italy reported zero fatalities for the first time since its outbreak. Still, the U.S. is considering restricting travel from Brazil, which now has the second-highest number of cases.

Fresh turmoil in Hong Kong that spilled over into street protests at the weekend is threatening to damage an already souring Sino-U.S. relationship. America should give up its “wishful thinking” of changing China, Foreign Minister Wang Yi said, warning that U.S. leaders are potentially pushing toward a new Cold War. Bullish sentiment is prevailing for now and global equities remain about 30% higher than the March lows, spurred by stimulus measures and optimism for a swift rebound from the virus.

“One big threat to the recovery in markets is the escalating war of words between the U.S. and China,” said Shane Oliver, head of investment strategy at AMP Capital Investors Ltd. in Sydney. “The main focus will likely remain on continuing evidence that the number of new Covid-19 cases is slowing in developed countries, progress towards medical solutions, the reopening of economies and signs that economic activity is picking up.”

Here are some key events coming up:

U.S. markets are closed Monday for Memorial Day holiday, while the U.K. is shut for the Spring bank holiday.Earnings continue with companies including Nissan Motor, British Land, Royal Bank of Canada and HP Inc.Singapore’s parliament on Tuesday is expected to announce another stimulus package.Thursday brings the U.S. jobless claims reading for the week ended May 23.Federal Reserve Chairman Jerome Powell participates in a virtual discussion on Friday.

These are the main moves in markets:

Stocks

The Euro Stoxx Index gained 0.7% as of 8:08 a.m. in London.Futures on the S&P 500 rose 0.4%.The MSCI Asia-Pacific Index climbed 0.8%.Japan’s Topix index advanced 1.7%.Hong Kong’s Hang Seng slid 0.1%.

Currencies

The Bloomberg Dollar Spot Index advanced 0.2%.The yen was little changed at 107.70 per dollar.The euro bought $1.0876, down 0.2%.

Bonds

The yield on 10-year German bunds fell 1 basis point to -0.5%.

Commodities

West Texas Intermediate crude added 1% to $33.61 a barrel.Gold dipped 0.5% to $1,726.58 an ounce.

Source: yahoo finance

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