US President Barack Obama has kicked off his 2012 re-election campaign.

There were more signs of recovery in the German economy on Monday with new car registrations up 11pct over the year to March to 328,000 vehicles.

European shares clawed their way to fresh three-week highs on Monday with merger and acquisition news in focus. In the chemicals sector Solvay has made a 3.4 billion euro bid for Rhodia. Vodafone also sold its 44pct stake in French mobile operator SFR to Vivendi for 7.95 billion euros. But financials stocks lost ground. The FTSEurofirst index rose by almost 0.1pct, but while the UK FTSE rose 0.1pct, the German Dax lost 0.1pct.

US blue chip share indices rose modestly on Monday while the tech-heavy Nasdaq was largely flat. There was little in the way of economic or corporate news to provide direction. The Dow Jones index rose by 23pts or 0.2pct with the S&P 500 up 0.5 points or less than 0.1pct while the Nasdaq eased 0.4pts or less than 0.1pct.

US treasuries rose modestly in thin trade on Monday (yields lower) in response to Federal Reserve purchases of bonds in the middle part of the curve. Federal Reserve chairman Ben Bernanke is to speak later on Monday night (US time). US 2yr yields fell 4pts to 0.766pct and US 10yr yields lost 2pts to 3.425pct.

Major currencies largely marked time against the US dollar on Monday in European and US trade. The Euro held between US$1.4190 and US$1.4250, ending US trade around US$1.4220. The Aussie dollar eased from highs near US103.95c to almost US103.35c, ending US trade near US103.65c. And the Japanese yen traded between 83.80 yen per US dollar and JPY84.20, ending US trade near JPY84.05.

US crude oil prices edged to fresh 30-month highs on Monday. Investors continue to watch the instability in the Middle East while also believing that a stronger US economy will translate to higher oil demand. The Nymex crude oil contract rose by US53c or 0.5pct to US$108.47 a barrel. But London Brent crude posted a stronger gain, up US$2.36 to US$121.06 a barrel - the highest close since August 2008.

Base metal prices were mixed on the London Metal Exchange on Monday. Lead rose 1.8pct and zinc rose 0.9pct but aluminium was flat and copper and nickel eased around 0.3pct. But the gold price gained ground on Monday with the Comex gold futures price up US$4.10 an ounce or 0.3pct to US$1433.00.

Ahead: In Australia, the Reserve Bank Board decides interest rate settings. Trade data is released. QBE holds its annual general meeting. In the US, the ISM services index is released together with minutes of the last Federal Reserve meeting.

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