(Alliance News) - Stocks in London are set to open lower on Monday, returning some gains after a strong showing last week, when global equities were spurred on by interest rate cut hope.

IG says futures indicate the FTSE 100 is to open down 15.3 points, or 0.2%, at 7,915.62 on Monday. The index of London large-caps closed climbed 48.37 points, 0.6%, at 7,930.92, on Friday. It had added 2.6% last week.

Interest rate cuts this year are "in play" amid signs that the risk of a wage-price spiral has diminished, the Bank of England governor has suggested.

Andrew Bailey said he is increasingly confident that inflation is heading towards the bank's target in an interview with the Financial Times.

He signalled that markets were right to expect more than one interest rate cut this year, and stressed how small the technical recession last year had been.

Sterling was quoted at USD1.2606 early Monday, lower than USD1.2627 at the London equities close on Friday.

The euro traded at USD1.0817 early Monday, lower than USD1.0829 late Friday. Against the yen, the dollar was quoted lower at JPY151.27 versus JPY151.46.

In Asia on Monday, the Nikkei 225 index in Tokyo was down 1.2%. In China, the Shanghai Composite was down 0.3%, while the Hang Seng index in Hong Kong was down 0.2%. The S&P/ASX 200 in Sydney closed up 0.5%.

China will phase out microprocessors from US firms Intel and Advanced Micro Devices so they cannot be used in government computers and servers under new guidelines, the Financial Times reported Sunday. The stricter new regulations also aim to sideline Microsoft's Windows operating system, in a shift towards domestic options.

In the US on Friday, Wall Street ended largely lower, with the Dow Jones Industrial Average down 0.8%, the S&P 500 down 0.1% and the Nasdaq Composite up 0.2%.

US President Joe Biden on Saturday signed into law a long-awaited funding bill passed by Congress, keeping federal agencies running through September and averting a damaging partial government shutdown.

"The bipartisan funding bill I just signed keeps the government open, invests in the American people, and strengthens our economy and national security," Biden said in a statement.

Senators missed a midnight deadline to pass the USD1.2 trillion package to keep the lights on in several key government agencies but voted in the early hours to pass a resolution that had already advanced from the House.

Gold was quoted at USD2,164.77 an ounce early Monday, lower than USD2,173.50 on Friday. Brent oil was trading at USD85.80 a barrel, higher than USD85.15 late Friday.

In Monday's UK corporate calendar, DIY retailer Kingfisher reports full-year results.

In the economic calendar, Bank of England Monetary Policy Committee member Catherine Mann speaks at 1415 GMT, while US new home sales data is out at 1400 GMT.

By Greg Rosenvinge, Alliance News senior reporter

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