Berliner Boersenzeitung - Stocks muted as investors eye US trade talks

Canada said Sunday it will restart trade negotiations with the United States after it rescinded a tax impacting US tech firms that had prompted US President Donald Trump to call off talks.

That boosted optimism for other governments to make deals with Trump to avoid his steep levies, as the July 9 cut-off for tariff reprieve looms.

"Investors seem confident trade deals will be struck, geopolitical tensions ease, and a major economic slump is avoided," said Dan Coatsworth, investment analyst at AJ Bell.

"The big unknown is whether investors are correct or are simply being too complacent," he added.

Officials from Japan and India have extended their stays in Washington to continue talks, raising hopes for agreements with two of the world's biggest economies.

Trade optimism helped boost most Asian stocks and US futures.

Meanwhile European equities were mixed in more tentative trade, with Paris ticking higher, London flat and Frankfurt edging lower.

Over the last month, US indices have notably outperformed European ones, explained Kathleen Brooks, research director at trading group XTB.

She attributed this to a "slowdown in the defence sector."

The dollar extended losses against its peers on Monday as traders ramped up bets for at least two rate cuts this year following Trump's indication he could choose a successor to Federal Reserve boss Jerome Powell within months.

A key US jobs report on Thursday will also be pored over for signs of the pace of interest-rate cuts.

Eyes were also on Trump's signature tax-cutting bill -- now inching towards a Senate vote -- that would add trillions of dollars to the national debt.

The "One Big Beautiful Bill" extends Trump's expiring first-term tax cuts at a cost of $4.5 trillion and beefs up border security.

The Republican president has ramped up pressure to get the package to his desk by July 4, and called out wavering lawmakers from his party.

However, there are worries about the impact on the economy, with the nonpartisan Congressional Budget Office estimating the measure would add nearly $3.3 trillion to US deficits over a decade.

The S&P 500 and Nasdaq finished at all-time peaks Friday amid optimism governments will be able to avoid swingeing US tariffs.

There was little major reaction on Monday to data showing the contraction in Chinese factory activity eased further in June after a China-US trade truce.

- Key figures at around 1050 GMT -

London - FTSE 100: FLAT at 8,799.59 points

Paris - CAC 40: UP 0.1 percent at 7,698.59

Frankfurt - DAX: DOWN 0.1 percent at 23,998.68

Tokyo - Nikkei 225: UP 0.8 percent at 40,487.39 (close)

Hong Kong - Hang Seng Index: DOWN 0.9 percent at 24,072.28 (close)

Shanghai - Composite: UP 0.6 percent at 3,444.43 (close)

New York - Dow: UP 1.0 percent at 43,819.27 (close)

Euro/dollar: UP at $1.1723 from $1.1718 on Friday

Pound/dollar: DOWN at $1.3698 from $1.3715

Dollar/yen: DOWN at 144.20 yen from 144.68 yen

Euro/pound: UP at 85.59 pence from 85.43 pence

West Texas Intermediate: DOWN 0.4 percent at $65.25 per barrel

Brent North Sea Crude: DOWN 0.3 percent at $66.61 per barrel

(Y.Berger--BBZ)