US consumer credit rose by US$20.37 billion in November - the biggest increase since 2001. The US employment trends index rose from 103.7 to 104.3 in December.

German industrial production fell by 0.6pct in November after rising 0.8pct in October, but was still up 3.6pct over the year. German exports rose 2.5pct in November with imports down 0.4pct, driving the trade surplus higher by 2.6 billion euros to 15.1 billion euros.

German and French leaders said they were making progress on a ´´fiscal compact´´ for closer convergence on economic policy in Europe to avoid future debt crises. The two countries are also looking at how to speed up payments into the euro zone´s permanent euro zone bailout scheme (European Stability Mechanism), which has been brought forward a year to mid-2012. The German Chancellor also wants to see progress on the voluntary restructuring of Greek debt before agreeing to more aid.

European shares eased in thin trade on Monday, driven lower by banking stocks.. The FTSEurofirst index fell by 0.4pct while both the UK FTSE and German Dax fell by 0.7pct.

US sharemarkets posted modest gains on Monday as investors awaited the start of earnings season. Alcoa releases results after the bell on Monday. At the close, the Dow Jones was up 32 points or 0.3pct with the S&P 500 up 0.2pct and the Nasdaq up 2pts or 0.1pct.

US treasuries rose modestly on Monday (yields lower) as traders took a cautious stance to discussions between French and German leaders. US 2yr yields fell 2pts to 0.248pct and US 10yr yields were steady at 1.958pct.

The US dollar lost ground against major currencies on Monday. The Euro rose from lows near $1.2690 to around US$1.2785 and was near US$1.2775 in late US trade. The Aussie dollar rose from US101.60c to US102.55c, and was around US102.45c in late US trade. And the Japanese yen held between 76.75 yen per US dollar and JPY76.95, and was near JPY76.85 in late US trade.

World crude oil prices eased on Monday. Generally traders and investors marked time in the absence of market-moving events such as key economic data. Iran confirmed the start of uranium enrichment at its Fordow nuclear plant. Iran´s nuclear program has prompted trade sanctions against the country by western nations and Iran recently countered by threatening to close the Strait of Hormuz. Nymex crude oil fell by US25c or 0.2pct to US$101.31 a barrel and London Brent crude fell by US61c to US$112.45 a barrel.

Base metals were mixed on Monday in the absence of new economic data. Copper lost 1.1pct and tin fell 0.3pct while other metals rose 0.4-1.9pct. Meanwhile the gold price fell for the second consecutive day as demand for safe-haven assets eased. The Comex February gold price fell by US$6.00 or 0.4pct to US$1,610.80 an ounce.

Ahead: In Australia, building approvals data is released. In the US, weekly chain store sales and wholesale sales/inventories data are released.