By Riva Gold

Stocks in Europe and Asia mostly started the week lower, tracking losses on Wall Street and a downturn in the oil price.

The Stoxx Europe 600 inched down 0.5% in morning trading after closing out its worst week since September.

The oil and gas sector led declines, with Brent crude recovering from earlier losses to trade down 0.1% at $50.61 a barrel. A meeting of officials from Iran and Iraq ended without an agreement on how the Organization of the Petroleum Exporting Countries would cut production, weighing on the oil price over the weekend.

Shares in Asia also broadly declined after U.S. stocks ended Friday a touch lower. Sentiment on Wall Street soured slightly after the Federal Bureau of Investigation said it was reviewing new evidence in connection with its investigation of Democratic presidential candidate Hillary Clinton's email server, just over a week before the election.

Markets in Shanghai, Hong Kong, and Japan dipped around 0.1%, while Korea's Kospi fell 0.6% after a weekend protest against South Korean President Park Geun-hye.

Futures pointed to 0.2% opening gain for the S&P 500, as the earnings season continues and investors look ahead to a meeting of Federal Reserve officials and the monthly jobs report later in the week.

Government bonds were broadly steady after a selloff last week pushed yields to five-month highs. The yield on the 10-year German government bond edged slightly lower to 0.156% on Monday, while the 10-year Treasury note was little changed at 1.842% from 1.847% on Friday, and the 10-year U.K. gilt yield was a touch lower at 1.242%.

The Fed's preferred measure of inflation is due later Monday. Rising inflation and rising yields could undermine the relative value case for stocks, with the correlation between bond and equity prices now positive, according to strategists at J.P. Morgan Cazenove.

"We can see weaker bonds performance ahead, but do not believe that equities benefit," they wrote in a note.

In currencies, the British pound inched down 0.1% against the dollar at $1.2178 following mixed media reports around Bank of England Gov. Mark Carney's plans to serve out a full eight-year term.

The news comes ahead of a Bank of England meeting on Thursday, where officials are expected to announce whether they will ease policy further this month after launching a multipronged stimulus in August.

The WSJ Dollar Index inched up 0.1%, recovering slightly from Friday's setback, while the euro fell 0.3% against the dollar to $1.0953.

Jason Douglas and Gregor Stuart Hunter contributed to this article.

Write to Riva Gold at

(END) Dow Jones Newswires

October 31, 2016 06:03 ET (10:03 GMT)

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