European shares open higher, oil falls on Ukraine peace efforts
European equity futures posted modest gains after Ukrainian President Volodymyr Zelenskiy said security guarantees for his nation will likely be worked out within 10 days after talks with U.S. President Donald Trump and European leaders.
Japan's Nikkei share gauge set a new intraday record high before heading lower. The U.S. dollar held on to gains from the previous session as traders awaited policy hints from the Federal Reserve ahead of its annual gathering in Jackson Hole, Wyoming.
"The Jackson Hole Symposium looms as one potential source of volatility, and going into the event, the markets remain cautious," Kyle Rodda, an analyst at Capital.com, wrote in a note to clients.
"A dovish shift is being priced in, with further strength in equity markets – and weakness in the U.S. dollar – reliant on the Fed meeting these expectations."
MSCI's broadest index of Asia-Pacific shares outside Japan slid 0.1 per cent after U.S. stocks ended the previous session with mild losses.
Pan-region Euro Stoxx 50 futures were up 0.2 per cent, while contracts for the German DAX and FTSE both crept up 0.1 per cent.
NATO Secretary General Mark Rutte told Fox News on Monday that Trump's meeting with Zelenskiy and other European and NATO partners was very successful.
The meeting followed a summit in Alaska between the U.S. president and Russian leader Vladimir Putin, which did not result in an agreement on ceasing hostilities in the 3-1/2-year-old war.
In a social media post late on Monday, Trump said he had called Putin and begun arranging a meeting between Putin and Zelenskiy, to be followed by a trilateral summit among the three presidents.
While traders are keeping an eye on geopolitical developments, another key focus for the week is the Fed's August 21-23 Jackson Hole symposium, where Chair Jerome Powell is due to speak on the economic outlook and the central bank's policy framework.
Money markets reflect an 83.6 per cent chance of a quarter-point rate cut at the Fed's meeting on September 17, according to CME FedWatch.
"Central banks seem to be easing even though inflation is creeping a little bit high in many countries," Tapas Strickland, head of market economics at National Australia Bank, said in a podcast. Bond investors may be "demanding a little bit more compensation for duration, just given the potential for the inflationary risk out there."
Japan's Nikkei stock index rose at the open before sliding 0.1 per cent, dragged lower by a 2.5 per cent plunge in SoftBank Group after the company announced a $2 billion stake in struggling U.S. chipmaker Intel.
The dollar slid 0.1 per cent to 147.78 yen. The euro was steady at $1.1663, while the dollar index, which tracks the greenback against a basket of currencies, was little changed after a 0.2 per cent gain in the previous session.
Oil slipped as market participants contemplated a potential end to the war in Ukraine, which could lead to an end to sanctions on Russian crude.
U.S. crude sank 0.8 per cent to $62.92 a barrel. Brent crude fell 0.7 per cent to $66.15. Spot gold rose 0.2 per cent to $3,337.41 per ounce.
Bitcoin slid 1 per cent to $115,257.59, while ether dropped $2.7 per cent to $4,224.33.
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