A Greek finance ministry official said on Monday that a final debt swap offer would be submitted to private sector bondholders by February 13. But the German Chancellor has ruled out extending a bridging loan to Greece.

Euro zone consumer confidence rose from minus 21.3 to minus 20.6 in January - the first improvement in seven months.

UBS has upgraded its stance on global equities to ´overweight´ from ´neutral´, saying that risks to economic growth and the stability of the financial system have abated.

International Monetary Fund head Christine Lagarde says that Europe should boost the size of its bailout fund, the European Stability Mechanism, but rejected suggestions that the lending capacity be doubled to one trillion euros. Lagarde has also warned of the consequences of inaction by European governments to deal with the debt crisis.

European shares rose to the highest levels in almost six months on Monday. Banks gained on speculation - later denied - that German and French finance ministers were seeking a watering down of Basel III capital requirements. The FTSEurofirst index rose by 0.5pct, with the UK FTSE up 0.9pct and German Dax up 0.5pct.

US sharemarkets eased from early highs in thin trade as investors awaited major economic and corporate news over the week. At the close of trade, the Dow Jones was down just 11 points or 0.1pct with the S&P 500 up 0.1pct and the Nasdaq fell 2.5pts or 0.1pct.

US longer-term treasuries eased further on Monday (yields higher) as investors lightened positions ahead of US$99 billion of new bond supply to be issued in the coming week. US 2yr yields were flat near 0.24pct and US 10yr yields rose by 4pts to 2.07pct

The Euro and commodity currencies rose against the US dollar on continued optimism that the European Debt Crisis may be stabilising. The Euro rose from lows near $1.2885 in European trade to around US$1.3050 and was near US$1.3030 in late US trade. The Aussie dollar rose from lows near US104.80c in European trade to US105.70c, and was near US105.30c in late US trade. And the Japanese yen held between 76.85 yen per US dollar to JPY77.07, and was near JPY76.97 in late US trade.

World crude oil prices rose on supply fears on Monday as the European Union agreed to ban Iranian oil imports from July 1. Nymex crude oil rose by US$1.25 or 1.3pct to US$99.58 a barrel and London Brent crude rose by US72c to US$110.58 a barrel.

Base metals rose on Monday in response to a weaker US dollar and optimism about a Greek debt deal. Metals rose 0.9-2.8pct but nickel bucked the trend, down 0.7pct. And the gold price rose on Monday with the Comex February gold price up by US$13.20 or 0.8pct to US$1,677.20 an ounce.

Ahead: In Australia, Newcrest and Oil Search release production figures and GUD Holdings releases its half yearly result. In the US, the Federal Reserve meets and the Richmond Fed index is scheduled.