By Riva Gold
Global stocks were mixed Monday ahead of a raft of key corporate and economic reports and a meeting of Federal Reserve officials later in the week.
Futures pointed to 0.1% opening gain for the S&P 500, rebounding slightly from Friday's modest pullback.
Recent improvements in bank earnings and a flurry of mergers and acquisitions are helping support sentiment around the stock market, said Benjardin Gärtner, head of equities at Union Investment.
"It reflects good financing conditions, and more confidence in the economic and business outlook," Mr. Gärtner said.
Shares of General Electric gained 0.9% in premarket trading after it reached a deal to combine its oil-and-gas business with Baker Hughes Inc., whose shares were up 8.7%.
Japan's three largest shipping companies also said Monday they would merge their container shipping operations, following a series of big global mergers announced last week.
Elsewhere, stocks in Europe and Asia mostly started the week lower, tracking Friday's losses on Wall Street and a downturn in the oil price.
The Stoxx Europe 600 inched down 0.4% late morning after closing out its worst week since September.
The oil and gas sector led declines, with Brent crude down 0.5% at $50.44 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.
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.
Government bonds firmed after a selloff last week pushed yields to five-month highs. The yield on the 10-year German government bond edged slightly lower to 0.150% 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 edged down to 1.219%. Yields move inversely to prices.
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 don't believe that equities benefit," they wrote in a note.
In currencies, South Africa's rand surged 1.6% against the dollar after the country's national prosecutor dropped fraud charges against Finance Minister Pravin Gordhan.
The British pound inched down 0.2% against the dollar at $1.2169 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, Joe Parkinson and Gregor Stuart Hunter contributed to this article.
Write to Riva Gold at firstname.lastname@example.org
(END) Dow Jones Newswires
October 31, 2016 08:08 ET (12:08 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.