UKX FTSE 100 Index

By Nathan Allen 

--U.S. stock futures rose 0.1% while the yield on 10-year U.S. Treasurys edged up to 2.103%.

--The Stoxx Europe 600 fell 0.1%, while the U.K.'s FTSE 100 and Germany's DAX were flat in afternoon trade.

--In Asia, Hong Kong's Hang Seng was the best performer among major indexes, gaining 0.4%

Deutsche Lufthansa AG dragged airline stocks lower in European trade Monday, countering gains by banks and insurers and leaving the benchmark Stoxx Europe 600 index slightly lower in afternoon trading.

Lufthansa issued its second profit warning of the year, dragging its shares down more than 12%. Ryanair Holdings PLC, Air France-KLM and EasyJet PLC all lost more than 3% amid concerns around overcapacity and deteriorating prices in the European short-haul market.

"These factors are certainly not 'new' news and so the fact Lufthansa is still moaning would suggest life is getting even tougher for the airlines," said Russ Mould, investment director at AJ Bell. "While price cuts are fantastic news for travelers, the airline can't sustain loss-making operations forever."

More broadly, investors are awaiting a series of central bank policy meetings this week from the U.S. to England and Japan. The main event will be the Federal Reserve's meeting, due to begin Wednesday, where members are likely to debate a potential interest-rate cut.

Wall Street futures for both the S&P 500 and the Dow Jones Industrial Average were unchanged. Both indexes finished slightly higher last week, despite losses Friday. Changes in futures don't necessarily reflect moves after the opening bell.

Later Monday, the Office of the U.S. Trade Representative is due to open seven days of public hearings on the Trump administration's proposal to raise a 25% levy on $300 billion of Chinese exports, including consumer goods such as mobile phones and laptops.

The week's main event will be the Federal Reserve's policy meeting, due to begin Wednesday, where members are likely to debate an interest-rate cut.

Markets rallied earlier in June after Fed Chairman Jerome Powell said the central bank would act to sustain U.S. economic expansion in the face of escalating geopolitical and trade tensions. However, some analysts said investors are overestimating the likelihood of such a cut given a run of fairly positive economic data.

"There is a real risk that this week's meeting could puncture a lot of this rising optimism around multiple rate cuts," said Michael Hewson, chief market analyst at CMC Markets U.K.

In Europe, investors will be focusing on the European Central Bank's annual forum in Portugal -- roughly equivalent to the Fed's Jackson Hole Symposium -- where the bank's president Mario Draghi is due to speak later this evening. While not an official monetary-policy meeting, the ECB has previously used the forum to signal a shift in approach.

Amid heightened expectations for possible easing, Deutsche Bank analyst Jim Reid questions whether the bank can credibly persuade markets that it still has the tools to reverse the trends of sliding bond yields and weak inflation.

Elsewhere, the Bank of Japan and the Bank of England will hold similar meetings Thursday, though no changes are expected from either of those meetings, Mr. Hewson said.

The yield on 10-year U.S. Treasurys edged up to 2.103%, from 2.102% Friday.

Shares in Deutsche Bank rose more than 3.2% after the Financial Times reported the German lender was considering shifting up to EUR50 billion ($56 billion) of risky assets to a so-called bad bank, and may shrink or shut its U.S. equities business amid a broad shake-up of its trading operations.

In Asia, China's Shenzhen Stock Exchange and Korea's Kospi fell 0.2%, but Hong Kong's Hang Seng gained 0.4% after authorities indefinitely suspended debating a controversial extradition bill that had sparked a wave of protests across the city. Japan's Nikkei was mostly unchanged.

Global oil benchmark Brent crude slipped 1% to $61.42 a barrel, following a rebound Friday, while gold dropped 0.4% to $1,339 a troy ounce.

The WSJ dollar index, which measures the currency against a basket of its peers, fell 0.1%.

(END) Dow Jones Newswires

June 17, 2019 08:37 ET (12:37 GMT)

FTSE 100
Index Chart
From Mar 2024 to Apr 2024

FTSE 100
Index Chart
From Apr 2023 to Apr 2024