Treasuries rose with gold, while US and European equities slipped as a note of caution spread through global financial markets amid signs of growing political uncertainty in France and as investors await details from the Trump administration on promised pro-growth policies.
The euro slumped versus the dollar and the regionâ€™s bonds advanced after prospective French presidential candidate Marine Le Pen unveiled a pledge to take her country out of the common currency. Gold surged to the highest since November, while 10-year Treasury yields touched a two-week low. The S&P 500 Index slipped as investors eyed corporate results amid a week light on economic data.
The risk-off mood that prevailed on Monday came after data showing disappointing wage growth in the US fueled speculation the Federal Reserve wonâ€™t rush to raise rates. European Central Bank President Mario Draghi testified that monetary support is still needed for inflation to pick up. Traders are assigning greater risk premiums to European countries where anti-establishment movements are gaining traction ahead of elections.
After Germany, industrial output data is coming this week from Spanish, Italian and French factories that should show their contribution to euro-area expansion in December. In the UK, industrial activity may have moderated. European banks including Societe Generale SA and UniCredit SpA report this week, and Sanofi and GlaxoSmithKline Plc will be among those delivering health-care earnings. Globally, watch out for numbers from BP Plc, SoftBank Group, the Walt Disney Co., Twitter Inc. and the Coca-Cola Co.