LONDON, July 22 - Global shares steadied on Monday, after President Joe Biden's decision to bow out of the election race at the weekend injected a degree of optimism into the markets, while a surprise rate cut by China's central bank failed to give Asian markets any pep.
Markets took the news in their stride, with S&P 500 stock futures up 0.5%, while Nasdaq futures rose 0.8%. "There's been a bit of a unwinding of that 'Trump trade', those fears we saw last week that lifted the dollar and pressurised European stocks at least and an overall, a bit of an upbeat mood on the news," Fiona Cincotta, senior market analyst at City Index, said.
U.S. Treasuries strengthened, pushing yields on the benchmark 10-year note down 1.6 basis points to 4.221%. Yields rose last week as investors priced in the prospect that a Trump administration would likely favour big increases in spending that would further undermine the United States' already stretched fiscal position.
Europe's biggest banks also report this week, with eyes on whether the gains from higher interest rates have run out of steam and if recent political drama is weighing on sentiment.In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan , opens new tab lost another 0.7%, having shed 3% last week.
The macro calendar is fairly packed this week too, with the Federal Reserve's favoured inflation measure out on Friday and a reading for advance U.S. gross domestic product.