Stocks advance, bonds fall as trade fears subside

London - A rebound in US equity futures Monday offered hope of stabilisation after last week’s rout, with shares in Europe and Asia also rising as investor fears of an escalation of trade tensions began to ease.

Car makers and oil companies were the top gainers in Europe as futures on the S&P 500 Index and the Nasdaq pointed to a higher open and Asian shares shook off earlier losses. Ten-year Treasury yields climbed three basis points ahead of major debt sales.

The dollar dropped to the lowest in a month and the yen slipped back from the strongest in more than 16 months. Copper extended losses following the largest weekly decline for base metals since early February.

The worst global stocks rout since early February appears to be giving way to a more optimistic mood this week as the limits of the Trump administration’s willingness to embrace protectionism came into view.

Treasury Secretary Steven Mnuchin told Fox News that he’s "cautiously hopeful" that China will reach a deal to avoid tariffs on $50bn of US exports, while European leaders demanded a permanent exclusion at the threat of retaliation and a deal was struck with South Korea.

Elsewhere Brent crude held above $70 a barrel on lingering tension in the Middle East. China launched its first ever crude-futures contract, denominated in yuan on the Shanghai International Energy Exchange.

Here’s a list of the main events coming up this week:

US personal income and spending data for February are due to be released on Thursday. The big four euro-are economies are due to release March CPI readings.

The US Treasury will probably auction about $294bn of bills and notes this week, its largest slate of supply ever.

And these are the main moves in markets:

Stocks

The Stoxx Europe 600 Index rose 0.4% as of 11:25 am London time. The MSCI All-Country World Index rose 0.3%, the largest advance in two weeks. Futures on the S&P 500 Index increased 1.3%, the biggest climb in more than two weeks.

The MSCI Asia Pacific Index rose 0.4%, the largest advance in two weeks.

Currencies

The Bloomberg Dollar Spot Index declined 0.3% to the lowest in more than five weeks. The euro climbed 0.4% to $1.2407, the strongest in almost three weeks. The British pound increased 0.6% to $1.4223, the strongest in more than seven weeks.

South Africa’s rand jumped 0.7% to 11.6693 per dollar, the strongest in four weeks.

The Japanese yen fell 0.3% to 105.06 per dollar.

Bonds

The yield on 10-year Treasuries climbed three basis points to 2.84%. Germany’s 10-year yield gained two basis points to 0.54%, the biggest climb in more than two weeks. Britain’s 10-year yield rose two basis points to 1.462%.

Commodities

Gold gained 0.1% to $1 348.24 an ounce, the highest in more than five weeks. Brent crude fell 0.1% to $70.37 a barrel. LME copper sank 1.6% to $6 555.50 per metric tonne, the lowest in almost 16 weeks on the largest tumble in more than two weeks.