FX.co ★ European Shares Poised For Weak Start As Treasuries Extend Fall

European stock markets are expected to open primarily in the red today due to escalating tensions in the Middle East and uncertainty regarding the Federal Reserve's monetary strategy for the year. The Houthi rebel group in Yemen has threatened to launch retaliatory attacks following airstrikes from the United States and United Kingdom, targeting 36 Houthi zones across 13 locations in Yemen.

Antony Blinken, U.S Secretary of State, will later today embark on a tour of the Middle East, including stops in Saudi Arabia, Egypt, Qatar, Israel, and the West Bank. In other news, former U.S. President, Donald Trump has suggested the possibility of imposing tariffs exceeding 60 percent on Chinese goods if he gets re-elected.

Asian stock markets were generally aslump today. Treasury bonds extended the selling trend seen on Friday, and the dollar appreciated against major world currencies following a solid U.S jobs report that decreased hopes for imminent interest-rate reductions.

Chairman of the Federal Reserve, Jerome Powell, stated during an interview on "60 Minutes" that broadcasted Sunday night, that interest rates cuts would wait for confirmed signs of reducing price inflation. In China, the stock market experienced significant fluctuations after the country's securities regulator pledged to control these wild swings.

Worries over growth continue as a private report indicated that China's services sector only experienced mild expansion in January. Gold declined by approximately half a percent in the Asian market, but oil prices were boosted by new airstrikes on Tehran-aligned factions situated in Iraq, Syria, and Yemen, orchestrated by the United States.

Regarding the current European economic agenda, Germany's foreign trade data and consumer confidence survey results from the euro area are to be released later on in the day. The U.S economic schedule for the week is relatively light, with attention likely to be paid to weekly unemployment claims, service sector activity, and the U.S trade deficit.

Prominent companies including Caterpillar, McDonald's, Amgen, Ford, Disney, and PepsiCo are slated to unveil their quarterly results this week. U.S stocks rose on Friday supported by impressive earnings reports from tech giants like Amazon and Meta Platforms, and favourable January employment figures.

The data unveiled that the U.S economy added 353,000 jobs in January, way ahead of the estimated 180,000 jobs. The previous month's job creation figure was revised upwards, and the January unemployment rate remained at 3.7 percent, leading investors to reconsider their prospects for interest-rate reductions in the current year.

The Dow and S&P 500 indices reached a new record closing high, with gains of 0.4 and 1.1 percent respectively, while the tech-centric Nasdaq index soared by 1.7 percent. European stocks closed mixed on Friday due to dwindling optimism for rate cuts. The Pan-European STOXX 600 index closed virtually flat after giving up early gains. The German DAX climbed 0.4 percent, and France's CAC 40 made marginal gains, but the UK's FTSE 100 closed in the red.