The OECD leading indicator rose from 103.0 to 103.2 in February. The US and Germany in particular were showing signs of a ´´robust expansion´´ while Chinese activity levels seemed to be moderating.

The IMF maintained 2011 and 2012 global growth forecasts of 4.4pct and 4.5pct respectively, in its latest world economic outlook. However it did highlight that emerging economies will have to deal with the threat of inflation. China was expected to grow at 9.6pct, followed by India at 8.2pct. The US economy was anticipated to grow at 2.8pct in 2011 while euro zone growth was upgraded to 1.6pct in 2011 and 1.8pct in 2012.

European shares eased from five-week highs on Monday. The construction sector was hit by a profit warning from German construction giant Hochtief (down 9.5pct). Carmakers were lower after broker downgrades to the sector. Banking stock recorded healthy gains after a British government report on the sector shied away from recommending a total split of retail and investment banking. The FTSEurofirst index fell by 0.2pct, the German Dax eased by 0.2pct and the UK FTSE was flat.

US sharemarkets were mixed on Monday as investors waited on the start of the reporting season. Energy stocks were weaker on the lower oil price. Alcoa fell 2.4pct in afterhours trade after reporting a first quarter profit that modestly beat expectations. The Dow Jones index rose by 1pt with the S&P 500 lower by 0.3pct and the Nasdaq lost 9pts or 0.3pct.

US treasuries fell on Monday (yields higher). Volumes were light as traders waited on the US$66 billion in notes that are expected to be auctioned over the next three days. US 2yr yields rose 2pts to 0.83pct and US 10yr yields lifted 1pts to 3.59pct.

The US dollar recorded modest gains against major currencies on Monday, after the US government shutdown was averted at the eleventh hour on Friday night. The Euro eased from highs near US$1.4470 to US$1.4420, ending US trade at US$1.4430. The Aussie dollar fell from highs near US105.70c to near US104.80c, ending near US104.90c. And the Japanese yen trade between 84.85 yen per US dollar to JPY84.50, before closing US trade at JPY84.60.

US crude oil prices fell from 32-month highs on Friday. Concerns that higher fuel costs will erode demand and threaten the economic recovery was the key driver. The Nymex crude oil contract fell by US$2.87 or 2.5pct to US$109.92 a barrel. The London Brent crude eased by US$2.67 to US$123.98 a barrel.

Base metal prices were mixed on the London Metal Exchange on Monday in response to a stronger greenback. Copper retreated from a five week high after a strong aftershock in Japan unnerved investors. Gold also eased following oil and base metals lower. The Comex gold futures price fell by US$6.00 an ounce to US$1,468.10.

Ahead: In Australia, NAB business survey and credit card data is released. In the US, FOMC minutes are released.

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