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European sharemarkets closed mostly lower on Monday. The panEuropean STOXX 600 index fell by 0.5%, with most sectors in negative territory. Autos stocks led the losses, down 2.8%. Shares of German energy company Uniper dropped 14.4% after a dispute flared up between Germany and Finland over the cost of rescuing the gas importer. The German Dax index slid 1.4%, but the UK FTSE index edged up less than 0.1%. In London trade, shares of Rio Tinto shed 0.5% and BHP shares dipped 2.3%.

US sharemarkets fell on Monday, with investors awaiting a key reading on US inflation and the start of the earnings season for clues on whether the US economy is headed for a recession. Shares of Twitter sank 11.3% after Elon Musk terminated a deal worth US$44 billion to buy the social media company. A slide in megacap tech names Apple (-1.5%), Alphabet (-3.1%), Amazon (-3.3%) and Tesla (- 6.6%) also weighed on major US indexes. Nike (-2.6%) and Caterpillar (-2.3%) were the biggest drags on the Dow Jones index. At the close of trade, the Dow Jones index fell by 164 points or 0.5% and the S&P 500 index dipped by 1.2%. The Nasdaq index shed 263 points or 2.3%.

US treasuries rose on Monday (yields lower) on safe-haven demand amid an equities sell-off on Wall Street. The US Treasury sold US$43 billion of 3-year notes at a yield of 3.093% into solid demand. The US 2/10-year yield curve remained inverted. US 10- year yields fell by around 11 points to near 2.99% and US 2-year yields dipped by around 5 points to near 3.08%.

Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.0142 to 20-year lows near US$1.0032 and was near US$1.0040 at the US close. The Aussie dollar dipped from highs near US68.18 cents to lows near US67.15 cents and was near US67.35 cents at the US close. And the Japanese yen eased from near 136.72 yen per US dollar to JPY137.72 and was near JPY137.45 at the US close.

Global oil prices were little changed on Monday as traders balanced an expected drop in demand due to mass testing for Covid19 in China against ongoing concerns over tight supply. The Brent crude price rose by US8 cents or 0.1% to US$107.10 a barrel. But the US Nymex crude price fell by US70 cents or 0.7% to US$104.09 a barrel.

Base metal prices were mixed on Monday. Copper fell by 2.9% with aluminium down 2.4%. Worries about demand in top consumer China due to new Covid-19 restrictions, and elsewhere because of interest rate rises, were reinforced by the soaring US dollar. But tin lifted by 3.5% with lead up by 1.7%.

The gold futures price fell by US$10.60 or 0.6% to US$1,731.70 an ounce. Spot gold was trading near US$1,733 an ounce at the US close. The iron ore futures price shed US$2.11 or 1.9% to US$111.65 a tonne as new virus flare-ups in Shanghai, China weighed on the demand outlook. Ahead: In Australia, business and consumer confidence surveys are scheduled with the CBA Household Spending Intentions index and tourism data. In the US, the NFIB small business optimism index is due.

Published by CommSec