Markets steady with much of Asia shut for holidays

European Council President Herman Van Rompuy, right, and European Commission President Jose Manuel Barroso address the media at the end of the EU Budget summit at the European Council building in Brussels, Friday, Feb. 8, 2013. European Union leaders have agreed to a a significantly reduced budget that represents the first decrease in a budget in the union's history. European Council President Herman Van Rompuy said Friday that the agreement had been reached after two days of negotiations. (AP Photo/Yves Logghe)
Yves Logghe

LONDON Global stocks were steady on Monday as major Asian markets were closed for the Lunar New Year and other national holidays.

In Europe, investors were relieved that European Union leaders on Friday approved a new 7-year budget. Negotiations on the 1 trillion euro ($1.3 trillion) spending plan were tough and threatened to be delayed by a year, renewing uncertainty over the group's ability to come together to solve its financial problems. But a compromise was eventually found on the second day of their second summit on the matter.

By midday in Europe, Germany's DAX was up 0.1 percent to 7,660.77 while France's CAC-40 added 0.5 percent to 3,665.23.

Britain's FTSE 100 rose 0.3 percent to 6,281.99 despite a survey showing business confidence hit a 21-year low. The BDO Optimism Index fell in January to the lowest level since it began and suggested the economy is contracting. Despite the pessimism, however, the survey suggested things would get better - hiring intentions for the next half-year rose.

Wall Street was expected to rise at the opening bell. Dow Jones industrial futures were up nearly 0.3 percent to 13,963 while the broader S&P 500 futures were 0.2 percent higher at 1,515.30. Markets there were supported by better U.S. trade figures, which led to an upward revision to the fourth quarter economic growth figures.

Later in the day, investors will keep an eye on the meeting of finance ministers from the 17 EU countries that use the euro in Brussels. The ministers have still to approve the details of a bailout plan for Cyprus. That will likely hinge on how they will deal with the country's banks, whose bad loans would be too large for the Cypriot government to take on.

Analysts warn that the movements of the euro could shift moods in markets in Europe in the coming days after European Central Bank President Mario Draghi noted that an excessive appreciation would affect its future monetary policy.

"We expect the market to become more cautious in chasing the single currency higher. This is especially true as any further euro appreciation would now have a direct impact on investors' ECB rate expectations," said Adam Myers, analyst at Credit Agricole CIB.

After falling sharply last week, the euro was steady on Monday, trading 0.1 percent higher at $1.3386.

In Asia, markets were closed in Hong Kong, mainland China, Seoul, Singapore, Taiwan and Vietnam for the Lunar New Year holiday, while Japanese markets were shut for a national holiday.

Of the markets that were open, Australia's S&P/ASX 200 closed 0.2 percent lower at 4,959.50. Key stock indexes in Thailand and New Zealand also fell.

Benchmark oil for March delivery dropped 34 cents to $95.38 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 11 cents on the Nymex on Friday to close at $95.72 a barrel.

In currencies, the dollar rose 0.6 percent to 93.33.