Shares in Europe and Asia have started off the week on a positive note, with Italian banks gaining after a deal to wind up two failed regional lenders. As Sonia Legg reports, German business confidence also unexpectedly rose in June to a record high.
Italian banks gave European shares a Monday morning boost. A bailout of two troubled lenders by Italy's government was approved by the European Commission. It sent the Italian bank index up 2 percent and the broader Milan market up 1 percent. (SOUNDBITE) (German) CAPITAL MARKETS SPECIALIST AT ODDO SEYDLER BANK, OLIVER ROTH, SAYING: "Of course markets are happy. We have seen bank closures before, in particular Lehman Brothers. It's important for markets and the financial world to have a certain stability and calculability so it's positive if banks are saved." There are doubts about the amount of money tax payers will have to contribute to the bailout. But European markets were clearly looking at the short-term. Germany's IFO helped keep the mood upbeat. Its measure of business confidence at 7,000 firms unexpectedly rose in June to a record high. (SOUNDBITE) (German) IFO ECONOMIST, KLAUS WOHLRABE, SAYING: "German consumers continue to shop. That's because companies keep hiring and there's no sign they're going to stop. Also, the many dark clouds in the economic sky - like Trump and Brexit - don't appear to be having much impact on the German economy." The dollar and U.S. bond yields held close to recent lows - subdued inflation raised questions over the outlook for monetary policy as central bankers prepare to meet mid-week. (SOUNDBITE) (English) WORLD FIRST, CHIEF ECONOMIST, JEREMY COOK, SAYING: "This is a talking shop I think it will stay as a talking shop and any speeches out there to move it move markets one way or the other will largely be forgotten about in the next couple of weeks." There was even relief for oil prices. They've been a major cause of lower inflation globally with prices falling 13 percent in May despite an OPEC deal to curb output. Brent crude - the international benchmark - started the week up 1 percent buoyed by the weaker dollar.