Stock markets edged higher, European bond yields dropped and the dollar remained firm in light trading on Monday amid warnings from the International Monetary Fund's managing director that a third of the world will fall into recession in 2023.
MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) rose 0.06%, just short of an index of global shares, which climbed 0.16%.
The pan-European STOXX 600 index (.STOXX) climbed 0.6%, retracing little of the nearly 12% it lost in 2022, bludgeoned by central banks' aggressive monetary policy tightening.
However, traders were reticent to trust early-year starts in stock and bond moves with many markets closed for a holiday and ahead of a host of economic numbers due this week.
Inflation data from Europe, minutes from the December U.S. Federal Reserve meeting and U.S. labour market numbers were some of the highlights that Danske Bank chief analyst Piet Haines Christiansen said would be worth watching.
Markets in the United States, Britain, Ireland, Singapore, Japan, Hong Kong and Australia were shut.
Christiansen expected the new year to kick off with a renewed focus on central banks and inflation. Traders would be vigilant for any signs of an approaching recession, he said.
Buoyant stock prices in Europe might be due, he said, to survey results published on Monday, which pointed towards a rebound in optimism among euro zone factory managers.
S&P Global’s final manufacturing Purchasing Managers’ Index (PMI) bounced to 47.8 in December from November’s 47.1, matching a preliminary reading but still below the 50 mark separating growth from contraction.
Elsewhere, the dollar edged almost 0.2% higher against a basket of major currencies, while the pound and euro fell 0.4% and 0.2% respectively.
"There is an attempt by the dollar index to pull higher today but we do see that it is losing a good part of the strength it gained last year," said Ulrich Leuchtmann, head of forex research at Commerzbank.
