World shares were rangebound and trading just off record highs on Monday as markets digested Friday's disappointing U.S. jobs report and a global tax deal between the G7 group of countries, while also looking ahead to inflation data due this week.
"I would assume that it is not helping the market in the sense that these Internet giants are going to be taxed more ... it has an impact on sentiment in equity markets, but the reality is, it has already been priced in," said Sebastien Galy, senior macro strategist at Nordea Asset Management. "With falling effective corporate tax rates accounting for over 30per cent of U.S. corporate profit growth since the turn of the century, companies will have to increasingly rely on margin expansion and revenue growth just to maintain the recent pace of profit growth," said Norman Villamin, CIO of wealth management at UBP.
While the 559,000 rise in May U.S. jobs missed forecasts it was still a relief after April's shockingly weak report. The jobless rate at 5.8per cent showed there was a long way to go to reach the Federal Reserve's goal of full employment. The European Central Bank will hold its policy meeting on Thursday and is widely expected to maintain its stimulus measures, with tapering a distant prospect.
That drop, combined with an improvement in risk appetite, put the dollar on the defensive. It was last at 90.202 against a basket of currencies, having slipped from a top of 90.629 on Friday.