US stocks retreated on Monday as concerns over possible fall-out from standoff between European Union and Greece weighed on investor confidence and market participants digested the disappointing economic news from China. Greece’s government announced plans to cancel about a third of the debt-reduction and economic reform measures imposed as conditions for its international bailout. Investors are concerned that Greece will default on its debt and may even leaver the euro-zone, which will have a negative impact on euro-zone economic growth and may even prompt other European countries to renege on their bail-out promises. The surprise trade data out of China, showing that exports slid 3.3% and imports fell more than 19%, indicate falling demand from abroad and home. On the backdrop of slowing overseas economic growth, US economy is proving resilient as it created 257 thousand jobs in January and more than a million jobs over the past three months, developments which are in line with Federal Reserve’s assessment of steadily improving US economy. More than 60 companies in the S&P 500 will report their earnings this week. Today at 14:20 CET Federal Open Market Committee member Jeffrey Lacker will speak on economy in North Carolina. At 16:00 CET the December Job Openings and Labor Turnover Study results and Wholesale Inventories will be released in US. The tentative outlook is positive with the number of job openings expected to rise from previous month while inventories are expected to grow at a much slower rate.
European stocks fell on Monday as worries over Greek debt standoff intensified and news about disappointing Chinese trade data hit the markets. Greece is considering proposing 10 new reforms at the Eurogroup meeting on Wednesday night in return for a longer bridging loan, to cover its funding needs until the end of August. The euro inched higher against the dollar on Monday, reversing earlier losses as markets appear to have priced in the possibility of Greece’s exit from euro-zone and widened German trade surplus and lower energy costs provided additional support to the single currency. Today at 10:30 CET December Industrial Production and Manufacturing Production will be published in UK. And at 16:00 CET the NIESR Gross Domestic Product for January will come out.
Nikkei is falling today having risen 0.4 percent on Monday. Investors are risk averse as Greece's rejection of its bailout terms spurred concerns over the prospect of financial turmoil in the euro zone. The Japanese yen traded higher against the dollar on Monday as investors moved in to buy yen after it fell against the dollar on Friday.
Oil advanced on Monday for a third straight session, helped by data indicating the number of oil rigs fell last week to the lowest level in roughly five years, marking the ninth straight weekly decline. At the same time, the Organization of the Petroleum Exporting Countries slashed its 2015 estimate for non-OPEC supply growth by 420,000 barrels a day to 850,000 barrels and raised demand forecast for its oil by 400,000 barrels per day to 29.2 million barrels a day in 2015.
Wheat harvests in Australia will produce larger-than-predicted crops in the country’s west and south, adding to the supply of the commodity in the biggest ever world grain production season that began July 1, according to United Nations’ Food & Agriculture Organization. Increasing supplies are pushing down.