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European shares are set to open lower on Monday, amid rising worries of an impending recession in the U.S.
Market jitters have grown recently over increasing signs of slowing economic growth and a possible recession. German manufacturing contracted for the third month in a row, IHS Markit data showed Friday, dragging the yield on the 10-year Bund into negative territory for the first time since October 2016.
Early Monday morning, the yield on the U.S. 10-year Treasury note dipped about 1.6 basis points below the yield on the three-month paper, an inversion that has traders worried a recession could be round the corner.
The yield curve — which plots bond yields from shortest maturity to highest and is considered a barometer of economic sentiment — inverted for the first time since mid-2007 on Friday.
Elsewhere, U.S. special counsel Robert Mueller’s two-year investigation into alleged coordination between President Donald Trump’s 2016 campaign and Russia has come to a conclusion. Attorney General William Barr said Sunday the probe found no sufficient evidence of collusion between the Trump campaign and the Kremlin.
The news is likely to be a boon to Trump, who has long called the inquiry a “witch hunt” and claimed there was “no collusion” between his presidential campaign and Moscow.
Back in Europe, Brexit remains a talking point, with reports of a plot to oust U.K. Prime Minister Theresa May surfacing over the weekend. The British leader met with senior ministers and Brexit-supporting lawmakers on Sunday to discuss the planned departure from the European Union.
The EU has offered the U.K. an extension to the Brexit date, but the length of such a delay depends on whether May’s twice-rejected divorce deal can gain the support of lawmakers.
In corporate news, meanwhile, Swedbank is due to report earnings on Monday. The Nordic-Baltic lender is one of a number of European banks to have faced allegations over money laundering. A heavily redacted report into allegations of money laundering through Swedbank’s Baltic branches was released on Friday.
On the data front, Ifo data on Germany’s business environment and economic conditions are due to be released Monday.