Global stock markets were little changed and the US dollar gained yesterday as investors weighed the possibility that US interest rates could soon be raised.
Commodities were weak across the board. Oil prices fell and were on track for a fourth session of losses as investors worried about global supply, and copper prices fell towards the three-month lows hit last week.
The Fed surprised investors when the central bank’s meeting minutes released last week opened the door to a rate hike as early as in June, roiling financial markets.
Topping the agenda this week is whether US data adds to the likelihood of a June or July rate increase.
MSCI’s all-country world stock index was flat, and the pan-European FTSEurofirst 300 index of leading regional stocks was down 0.5 per cent.
On Wall Street, the Dow Jones industrial average was up 16.92 points, or 0.1 per cent, to 17,517.86, the S&P 500 had lost 1.09 points, or 0.05 per cent, to 2,051.23 and the Nasdaq Composite had added 11.70 points, or 0.25 per cent, to 4,781.26.
Shares of Monsanto were up 4.6 per cent in late morning New York trading after Bayer unveiled a $62 billion bid for US seeds company Monsanto. Bayer AG declined in European trading.
Investors also digested economic data that showed eurozone private sector growth in manufacturing and services slowing down a little in May, even though Germany continued to power ahead.
In the currency markets, the US dollar gained against the euro, but slipped against the yen on Japanese trade data and US resistance to currency intervention from Tokyo.
The dollar index, which measures the greenback against a basket of six major rivals, was last up 0.03 per cent to 95.36.
Brent crude prices were down one per cent, on pace for a four-day losing streak and matching a similar run in mid-April, as investor focus returned to global supply, with Iran insisting on a rise in oil exports and US drillers slowing the reduction in rigs. US crude was down 0.5 per cent at $48.17.
Short-dated US Treasury yields rose, with the two-year yield hovering at its highest in two months on Fed rate-hike bets.
The yield on two-year Treasury yield hit 0.905 per cent, within striking distance of the two-month peak of 0.920 per cent set last Thursday.
Benchmark 10-year Treasury notes were up 2/32 in price with a yield of 1.842 per cent, down 1 basis point from Friday.
In the metals market, benchmark copper on the London Metal Exchange was down 0.3 per cent at $4,565 a tonne at 1345 GMT.