LONDON (AP) — Stock markets remained relatively solid Monday as evidence of a steady economic recovery in the U.S. continued to shore up sentiment.
Following another week, which saw many stock indexes around the world either hit record highs or multiyear peaks, investors have so far refrained from widespread profit-taking.
However, some analysts are beginning to wonder when a reverse will take place. That could be triggered if officials at the U.S. Federal Reserve start pondering an early end to the central bank's super-easy monetary policy after a run of strong U.S. economic data, particularly with regard to housing and jobs. The money generated by the Fed over the past few years in an attempt to keep the U.S. economy on an even keel has been one of the reasons why financial assets, such as stocks, have enjoyed strong gains despite a patchy global recovery.
In that context, investors will be particularly interested to hear what Fed chairman Ben Bernanke says when he addresses lawmakers on Wednesday.
"With many of the main indices looking dangerously overbought we are probably overdue a correction," said Mike McCudden, head of derivatives at Interactive Investor.
"All eyes will be on the Congressional testimony on Wednesday for confirmation that the Fed will start to scale back the bond purchasing program later in the year," he added.
Any concerns over a change in policy did not have any market impact Monday.
In Europe, the FTSE 100 index of leading British shares was flat at 6,725 but around 13-year highs. Germany's DAX, which has set a series of all-time highs, rose 0.5 percent to 8,441. The CAC-40 in France was 0.2 percent higher at 4,009.
Wall Street was poised for a fairly steady opening, with both Dow futures and the broader S&P 500 futures up 0.1 percent. The two indexes have also racked up a series of record highs.
In the currency markets, the dollar was slightly soft as traders booked some recent gains, with the euro up 0.4 percent at $1.2862. Against the yen, it was 0.6 percent lower at 102.55.
Earlier in Asia, stock markets had a strong start to the week. Japan's Nikkei 225 index jumped 1.5 percent to 15,360.81 while Hong Kong's Hang Seng surged 1.8 percent to 23,493.03. Benchmarks in mainland China also rose but South Korea's Kospi fell 0.2 percent to 1,982.43.
Oil prices were fairly subdued, with the benchmark New York rate down 65 cents at $95.37 a barrel.