Europe stocks, S&P futures dip on mixed trade news: markets wrap

European stocks and US equity futures slipped on Monday while Asian markets posted modest gains as investors assessed the latest headlines on the economy and trade. The dollar was steady, while bonds in Europe were mixed.

The Stoxx Europe 600 Index was on course for its first drop in five days, tracking S&P 500 futures lower on what is a holiday in America. Shares in Tokyo, Hong Kong and Sydney all climbed on lingering optimism for the next round of US-China trade talks, and as data from Beijing helped ease concern of a continued deterioration in the world’s second-largest economy. Not all was sunny, however; Bloomberg reported that the two sides are making little progress on the key issue of intellectual property protection. The yen strengthened, while Treasuries didn’t trade.

Investors may be catching their breath following last week’s rally in risk assets amid positive manufacturing numbers and signs the US and China were closing in on a trade truce. The picture has grown more complex the reports on intellectual property paint a less optimistic view on the outlook for talks, while data on Monday confirmed China’s economy expanded at the slowest pace since the global financial crisis, even as December figures for industrial output and retail sales were buoyant.

Elsewhere, the pound erased a loss before Theresa May returns to Parliament to explain what she’s going to do next on Brexit. The UK prime minister has ditched cross-party talks and is set to try to get her failed deal through with votes of Conservatives and her Northern Irish allies.

These are some events investors will be watching out for in the coming days:

Theresa May will explain her next steps on Brexit later on Monday. Earnings season is in full swing: Johnson & Johnson, IBM, UBS, United Technologies, Texas Instruments, and Ford are among companies posting results this week. The World Economic Forum, the annual gathering of global leaders in politics, business and culture, opens in Davos, Switzerland on Tuesday. There are rate decisions for the Bank of Japan (Wednesday), the Bank of Korea and the European Central Bank (both Thursday).And these are the main moves in markets:

Stocks

The Stoxx Europe 600 Index dipped 0.3% as of 1:13 p.m. London time, the first retreat in a week. Futures on the S&P 500 Index sank 0.3%, the first retreat in a week. The UK’s FTSE 100 Index gained 0.1% to the highest in almost seven weeks. Germany’s DAX Index sank 0.6%, the biggest dip in more than two weeks. The MSCI Emerging Market Index fell 0.1%, the largest fall in a week. The MSCI Asia Pacific Index climbed 0.3% to the highest in almost seven weeks.

Currencies

The Bloomberg Dollar Spot Index increased 0.1%, hitting the highest in more than two weeks with its fifth straight advance. The euro declined less than 0.05% to $1.1362, reaching the weakest in almost three weeks on its eighth consecutive decline. The British pound fell less than 0.05% to $1.2868. The Japanese yen climbed 0.1% to 109.67 per dollar, the first advance in a week.

Bonds

Germany’s 10-year yield declined one basis point to 0.25%. Britain’s 10-year yield sank four basis points to 1.31%, the largest tumble in almost three weeks. Italy’s 10-year yield advanced two basis points to 2.75%.

Commodities

West Texas Intermediate crude gained 0.2% to $53.92 a barrel, the highest in two months. Gold fell 0.3% to $1,277.91 an ounce, the weakest in more than three weeks.

© 2019 Bloomberg L.P