European stock markets rebounded on Monday after last week’s slump that took share prices to their lowest levels in two years.
It is the same story on Wall Street. In addition traders in New York are awaiting a speech from the US Federal Reserve Chairman Ben Bernanke on Friday – hoping he may announce new stimulus measures.
Bargain hunters are out in force on both sides of the Atlantic with investors grabbing shares that look to be good value after the recent declines.
But they remain nervous as the threat of recession still hangs over Europe and the US and there are persistent worries that the sovereign debt crisis in euro zone peripheral countries may spread to bigger regional economies.
Financial analyst Oliver Roth, of Close Brothers Seydler Bank explained: “Every wave of sales needs a break and I think we will see a break this week. The market is going to go sideways, and at the end of the week some economic data will be published which we will watch carefully as recession is an issue here.”
Brent crude oil is down on the belief that exports will soon resume from Libya.
Italian integrated oil firms were among the top performers on hopes of an end to the conflict in Libya. ENI , the largest foreign oil operator in Libya and Saras both gained on prospects for a resumption of oil operations were Muammar Gaddafi’s regime to fold.
Gold prices have slipped from their earlier record highs but remain elevated. Investors have been buying the precious metal as a safe haven from the current economic uncertainty.
The move into bullion comes as China’s top official newspaper said on Monday the crises currently impacting the United States and Europe will have a far-reaching impact on its real economy.
German Chancellor Angela Merkel appeared to close the door on the idea of “euro bonds”, which market commentators see as a way of the region easing the region’s debt troubles.