In US economic data, the ISM New York index rose from 635.3 to 644.4 in July. The employment trends index rose from 119.32 to 120.31 in July.
European shares fell on Monday. While investors were heartened that the Portuguese Government agreed to rescue Banco Espirito Santo, its largest bank, there were concerns about the impact of European sanctions on Russia. The FTSEurofirst 300 index fell by 0.2 per cent with the German Dax down by 0.6 per cent while the UK FTSE lost less than 0.1 per cent. Australia's major miners were up modestly in London trade with shares in BHP Billiton edging up by 0.1 per cent while Rio Tinto rose by 0.2 per cent.
US sharemarkets rose on Monday as geopolitical jitters eased and bargain-hunters waded in. Banks lifted in late trade after a quarterly Federal Reserve survey showed stronger lending demand in the last quarter. The Dow Jones index rose by almost 76 points or 0.5 per cent with the S&P 500 index up by 0.7 per cent while the Nasdaq gained 31 points or 0.7 per cent.
US treasury prices settled on Monday as the sharemarket lifted from session lows. Jitters eased about an earlier-than-expected rate hike by the Federal Reserve. US 2-year yields fell by 1 point to 0.472 per cent while US 10-year yields were down by 1 point to 2.489 per cent.
Major currencies were generally firmer against the US dollar after European and US sessions on Monday. The euro fell from highs near $US1.3430 to around $US1.3410, before ending US trade near $US1.3420. The Aussie dollar lifted from lows near US93.05c to highs near US93.35c, ending the US session near its highs. And the Japanese yen rose from 102.71 yen per US dollar to JPY102.41, ending US trade near JPY102.57.
World oil prices rose on Monday on an easing of geopolitical jitters. Investors turned their attention to Libya where ongoing violence could lead to a disruption of oil supplies. US and Chinese economic data was also encouraging. Brent crude rose by US57 cents or 0.5 per cent to $US105.41 a barrel and the US Nymex price rose by US41 cents a barrel to $US98.29 a barrel.
Base metal prices rose by up to 2.6 per cent on Monday with aluminium and lead up the most. But tin bucked the trend, down 0.3 per cent. Gold prices fell on Monday as some of the geopolitical concerns eased. The Comex gold futures quote fell by $US5.90 or 0.5 per cent to $US1,287.70 per ounce. Iron ore rose by US20c on Monday or 0.2 per cent to $US95.40 a tonne.
Ahead: In Australia, the Reserve Bank Board meets to decide interest rate settings. Trade data is released together with the services sector survey. In the US, the ISM services index is released together with weekly chain store sales and factory orders. In China the HSBC services purchasing managers index is released.
Craig James is chief economist at Commsec.