London (Reuters) – Hope for progress in trade between Chinese and US trade and expectations of central bank political stimulus lifted world stocks to 2-1 / 2 month highs on Monday, although European gains were curbed by car sector concerns Outlook.
The German share price index DAX graph is depicted on the Frankfurt stock exchange, Germany, February 15, 2019. REUTERS / Staff
The MSCI worldwide world index rose 0.3 percent after Japan's Nikkei stopped 1.8 percent at its highest level on The year and the MSCI Asian Equity Index rose almost one percent. Shanghai blue chips increased 2.7 percent to its highest finish in more than six months.
Trade negotiations between the United States and China will resume this week, with US President Donald Trump saying he can be extended on a March 1 deadline for a deal. Both sides reported progress at last week's talks in Beijing.
But the mood was worse in Europe, where a pan-European stock index narrowed to a new four-month high, but the gain was capped by the car sector, which was hit by data showing that Chinese car sales fell 16 percent in January, their seventh straight month of decline .
The Autos index, a bellwether for Europe's economy, fell 0.9 percent, also pressured by the fear that an American trading department reports to President Trump could release steep rates on imported cars and auto parts. German shares fell 0.3 percent.
Trump has 90 days to decide to follow the recommendations.
"Optimism on trading has been strong, but the underlying economic data has been much weaker – so you have some push and pull factors," said David Vickers, senior portfolio manager at Russell Investments, adding a lot of focus was now on Flash PMI data expires later in the week.
"As the study back from the December downturn faded … the basics are restoring now," added Vickers.
Recent delays in soft economic data have led to expectations that the world's most powerful central banks could deliver on reflective policies and provide support to the markets.
The need for stimulus was highlighted by data showing a strong light in Singapore exports and a large decline in foreign orders for Japanese hardware products.
Beijing is already trading with China's banks to make the most new loans on record in January in an attempt to jump on slow investment.
E-Mini futures for the S & P 500 were flat as trading was thinned by a vacation in US markets. Dow and Nasdaq boasted their eighth consecutive weekly winnings on bets, the US and China would hammer a deal to resolve their long-standing trade war. [.N]
Minutes of the Federal Reserve's last political meeting are due on Wednesday and should provide more guidance on the likelihood of interest rate increases this year. There is also talk that the bank will maintain a much larger balance than previously planned.
"Given the spectrum of speakers since the January meeting that supports" patience ", the Fed minutes should repeat a bold message," TD Securities analysts said in a note.
The dollar was steady on the yen at 110.57, and had relied on a two-month peak at 111.12.
Sterling drove higher after registering three consecutive weeks of losses that investors were waiting for the outcome of Brexit talks between the UK and the EU.
British Prime Minister Theresa May plans to talk to all EU leaders and European Commission chief to seek changes to the EU recall agreement, after another defeat by their own legislators last week.
Everyone who left the dollar a shadow lower of 96,835 on a basket of currencies and away from last week's top 97,368.
In commodity markets, oil prices peaked for the year, occupied by OPEC-led supply cuts and US sanctions against Iran and Venezuela. Burned raw futures rose quarter-on-quarter to $ 66.30.
Reporting by Karin Strohecker, Additional Reporting by Wayne Cole in Sydney, Editing Ed Osmond