European Shares Set To Follow Asian Peers Higher

European stocks may follow Asian peers higher on Monday after Chinese markets jumped the most in more than two years following soothing comments from top officials about the health of the economy.

After last week’s coordinated pronouncements from three top Chinese financial regulators, Chinese President Xi Jinping vowed “unwavering” support for the country’s private sector.

In an open letter published in state media, he said that Beijing would continue to value and protect the country’s private business owners to ensure a “better tomorrow”.

China’s Shanghai Composite index is up as much as 4.5 percent, extending a 2.6 percent rebound on Friday. Hong Kong’s Hang Seng index is climbing 2.4 percent.

Markets elsewhere across Asia are turning in a mixed performance amid concerns surrounding Saudi Arabia, Italy and Brexit. U.S. President Donald Trump accused Saudi Arabia of lying about the killing of Jamal Khashoggi, as pressure built on the administration to identify and punish those responsible for his murder.

In Europe, today marks the deadline for Rome to reply to the European Commission’s criticism of its budget proposal.

British Prime Minister Theresa May is set to tell lawmakers later today that 95 percent of the Withdrawal Agreement and its protocols are now settled despite a disagreement on the so-called Northern Irish backstop.

The European Central Bank (ECB) will announce its interest rate decision on Thursday, with economists expecting no change in monetary policy.

The dollar eased and gold hovered near a 2-1/2-month high hit last week while oil held steady on expectations of a tightening market amid looming U.S. sanctions against Iran.

Earnings news is likely to be in the spotlight in the U.S. this week, as the economic calendar is relatively quiet. 3M, Caterpillar, McDonald’s, Verizon, AT&T, Boeing, UPS, Ford, Microsoft, Merck, Twitter, Amazon and Intel are among the prominent companies reporting their quarterly results.

U.S. stocks ended mixed on Friday, with upbeat earnings updates from the likes of Procter & Gamble, American Express and Honeywell as well as a rebound in Chinese equities helping limit the downside.

The Dow inched up 0.3 percent, while the tech-heavy Nasdaq Composite dropped half a percent and the S&P 500 finished marginally lower.

European markets fluctuated on Friday before ending mixed as third-quarter earnings proved to be a mixed bag and concerns over Italy’s controversial budget plans drove Italian government bond yields to four-year highs.

The pan-European Stoxx Europe 600 index slid 0.1 percent. The German DAX dropped 0.3 percent and France’s CAC 40 index declined 0.6 percent while the U.K.’s FTSE 100 rose 0.3 percent.