Yesterday it was only the US that got the full benefit of the market-wide stop hunt that sent the U.S. market soaring on its biggest opening ramp in 2015 following the worst payroll data since 2013, because Europe was closed for Easter Monday. Which means today it was Europe's turn to celebrate atrocious US data (yes, yes, snow - because somehow tremendous January and February jobs data was not impacted by snow), and in the first European trading session of the week, equities have started off on the front-foot, with the Stoxx 600 up well over 1% at last check.

Europe has followed suit from the US paring the declines on Friday when they returned to market yesterday, with Asian equities also trading higher overnight, with the Nikkei 225 (+1.25%) further bolstered by the weaker JPY. Furthermore, positive sentiment from Europe has also stemmed from weekend reports that Greece will make its upcoming payment to the IMF on Thursday, which has subsequently lifted the ASE (+1.7%) while the GR/GE spread (-18bps) is the tightest in Europe. On a sector specific basis for Europe, energy names have led the way higher given the sharp gains seen yesterday in WTI and Brent crude futures yesterday. Elsewhere, postal names across Europe have been supported by FedEx’s (FDX) takeover bid of TNT (+30.5%).

Fixed income markets trade in a relatively rangebound manner with the exception of Gilts which are currently underperforming ahead of GBP 4bln in 5y Gilt supply tomorrow (21K long gilt future equiv.) and also trail European core paper which is supported by net positive supply this week due to EUR 19bln in redemption payments. Looking ahead, focus for fixed income markets could later be swayed by the USD 24bln 3yr note auction.

In FX markets, the USD-index has continued its pullback from Friday’s nonfarm payrolls lows, which has subsequently weighed on its major counterparts, sending EUR/USD back below 1.0900 where there is a USD 2.1bln option expiry due to roll off at the 10am (1500BST) NY Cut. Elsewhere, AUD has managed to hold onto its RBA-inspired gains after the RBA stood pat on its policy rate as expected by consensus despite the market pricing in a cut, prompting an aggressive relief rally. Furthermore, participants shrugged off dovish commentary from RBA’s policy statement as the central bank hinted at further easing and AUD weakening in the period ahead. GBP failed to benefit from the better than expected services PMI (58.9 vs Exp. 57.0) after being weighed on by the USD.

In the commodity complex, WTI and Brent crude futures trade lower amid profit taking after finishing yesterday’s session up 6.1%, ahead of today’s API crude oil inventory report. In terms of downside for today, price action has also been swayed by reports that Iran has visited China in an attempt to increase oil sales to the area, a note from Goldman Sachs (GS) which suggested the bank does not see much upside for its USD 40bbl 3-month forecast and the stronger USD. In precious metals markets, spot gold and spot silver have been weighed on by the resurgent USD, while industrial metals rose overnight seeing nickel rebound

In summary: European shares rise with the oil & gas and utilities sectors outperforming and autos, insurance underperforming. The Dutch and French markets are the best-performing larger bourses, Swiss the worst. The euro is weaker against the dollar. Japanese 10yr bond yields rise; German yields decline. Commodities decline, with nickel, WTI crude underperforming and natural gas outperforming. U.S. consumer credit, IBD/TIPP economic optimism, JOLT job openings due later.

Bulletin Headline Summary from Bloomberg and RanSquawk

• European equities trade higher alongside the pullback in equities seen yesterday and gains overnight during Asia-Pacific trade
• USD-index also continues to pullback from its post-NFP lows, subsequently weighing on its major counterparts while AUD outperforms after the RBA stood pat on rates
• Looking ahead, today’s session seen an absence of tier 1 US data, with Fed’s Kocherlakota due on the speaker slate at 1350BST.
• Treasuries slightly weaker on short-end before today’s auction of $24b 3Y notes, WI yield 0.85%; last auction sold at 1.104%.
• Australia’s central bank said for a second month it could ease policy at future meetings after keeping interest rates unchanged at a record low as the economy grapples with tumbling commodity prices
• U.K. services growth accelerated to a seven-month high in March as the broader economy gained momentum in the first three months of 2015
• The Bank of England is pushing U.K. banks to have plans in place in case the Greek debt crisis escalates or the country leaves the euro area
• Russia’s central bank will abstain from a program of quantitative easing and instead rely on interest rates to boost the recession-bound economy if  inflation risks continue to abate, Governor Elvira Nabiullina said
• Russia said only direct talks with Ukrainian authorities may change its refusal to join debt restructuring negotiations
• No official contacts have taken place with Ukraine’s inance Ministry about renegotiating $3b of Eurobond debt, Russian Deputy FM Sergey Storchak said
• Oil fell after the biggest rally in two months as investors weighed forecasts for rising U.S. crude supplies against signs that Saudi Arabia is betting on an improvement in demand
• Whether it’s Rahm Emanuel or Jesus “Chuy” Garcia, the victor in Chicago’s mayoral runoff will face the unenviable task of reversing a fiscal decline that’s left the city’s credit rating on the cusp of junk
• Asian and European equities rise. U.S. equity-index futures mixed. Crude and gold lower, copper rises

US Event Calendar

• 10:00am: IBD/TIPP Economic Optimism, April, est. 49.0 (prior 1)
• 10:00am: JOLTS Job Openings, Feb., est. 5.007m (prior 4.998m)
• 3:00pm: Consumer Credit, Feb., est. $12.25b (prior $11.562b)

Market Wrap

• S&P 500 futures little changed at 2072.3
• Stoxx 600 up 1.1% to 402.3
• Euro down 0.68% to $1.0848
• Dollar Index up 0.91% to 97.65
• US 10Yr yield up 1bps to 1.9%
• German 10Yr yield down 1bps to 0.18%
• MSCI Asia Pacific up 0.2% to 149.1
• Gold spot down 0.6% to $1207.9/oz
• Eurostoxx 50 +1%, FTSE 100 +1.2%, CAC 40 +1.2%, DAX +1%, IBEX +0.8%, FTSEMIB +1%, SMI +0.9%
• Asian stocks rise with the Shanghai Composite outperforming and the Sensex underperforming.
• MSCI Asia Pacific up 0.2% to 149.1; Nikkei 225 up 1.3%, Hang Seng closed, Kospi up 0%, Shanghai Composite up 2.5%, ASX up 0.5%, Sensex down 0.6%
• 5 out of 10 sectors rise with materials, energy outperforming and consumer, utilities underperforming
• Italian 10Yr yield down 5bps to 1.25%
• Spanish 10Yr yield down 4bps to 1.18%
• French 10Yr yield down 2bps to 0.46%
• S&P GSCI Index down 0.7% to 410.2
• Brent Futures down 1.3% to $57.4/bbl, WTI Futures down 1.5% to $51.4/bbl
• LME 3m Copper up 0.7% to $6021.5/MT
• LME 3m Nickel down 2.3% to $12725/MT
• Wheat futures down 0.9% to 523 USd/bu

DB's Jim Reid is also back from holiday with his first "Early Morning Reid" summary since the nonfarm payrolls bomb

Although Friday's weak payroll number is now some 87 hours and a lot of chocolate behind us, the shadow of it will likely dictate trading this week with Greece, the start of Q1 US earnings and China's monthly data dump on Friday competing for attention as the week progresses. With regards to the weak payroll print, one doesn't want to overstate the importance of one number but it certainly does help our long standing view that the Fed will struggle to raise rates in 2015. At the back end of last year this view was not really taken that seriously but it’s now not beyond the realms of possibility. In fact a month or so ago we discussed how if you were looking from scratch at the US economy without any pre-conceptions or knowledge of any Fed speak you might conclude that the next move might be an easing from the US central bank. I wonder what the probability is now of the next move being looser policy? Still very low of course and although this is nowhere near current market thinking, the strong US session yesterday (S&P 500 SPY +0.66%) and rebound from the immediate post payroll lows in the futures contracts on Friday surely partly reflects market appreciation that the Fed might be on hold for longer.

A rally in oil markets also helped yesterday’s stronger showing in risk assets, while some dovish chatter out of the Fed’s Dudley attracted headlines. Specifically, the NY Fed President said that ‘the timing of normalization will be data dependent and remains uncertain because the future evolution of the economy cannot be fully anticipated’. He also discussed how the path of any rate rises will likely be ‘shallow’ (Reuters). Dudley did however say that recent weaker economic data – including the March employment report - was likely to reflect temporary factors to a significant degree, but that the Fed will need to ‘determine whether the softness in the March labor market report foreshadows a more substantial slowing in the labour market than I currently anticipate’. Meanwhile, in comments post-market close, the Fed’s Lockhart narrowed his preferred time frame for liftoff to July-September, saying that June may come too soon. Lockhart also backed up the earlier comments from Dudley by saying that the weaker data in Q1 is likely temporary and that ‘ups and downs’ in job data are unsurprising.

As mentioned it was a better day for equities with the initial 0.5% fall in the S&P 500 on the back of Friday’s data lasting for all of 15 minutes as markets quickly reversed. Despite broad based gains, oil was clearly supportive as energy stocks (+1.77%) led the reversal. WTI (+6.11%) and Brent (+5.77%) rallied on the back of Saudi Arabia raising prices for crude shipments into Asia. Credit markets closed firmer also as CDX IG finished 2bps tighter. With the better sentiment generally, Treasuries meanwhile gave up most of Friday’s gains as the benchmark 10y yield finished 5.6bps higher at 1.895%, having closed at 1.911% pre-payrolls on Thursday before rallying into 1.839% post the print on Friday. A late bounce in the Dollar wasn’t enough to offset Friday’s weakness however, with the +0.24% return for the DXY halting three previous negative sessions including a -0.9% day on Friday.

Elsewhere in the US yesterday, data was generally supportive. The final March reading for the services PMI was revised up 0.6pts to 59.2, putting it at the highest level since August last year. Meanwhile, the ISM non-manufacturing reading for last month was as expected at 56.5.

Moving on, with markets closed in Europe yesterday the focus continues to be on Greece headlines. Over the weekend, Greek finance minister Varoufakis and the IMF’s Lagarde met for informal talks. As well as the (generally unsurprising) conciliatory headlines in the joint statement following the meeting, Varoufakis pledged to meet this week’s upcoming €440m IMF payment on Thursday, easing earlier concerns that the government was to prioritize wages and pension payments over the repayment. Lagarde also confirmed that talks are due to restart with Greece and the Brussels Group this week. DB’s George Saravelos noted last week that talks remain slow and ultimately the path forward has still not changed materially from a month ago. The issue around the content of the staff level agreement, with the agreement on fiscal targets and the budget gap in particular, is proving to be a sticking point. George notes that the binding constraint to the completion of the negotiation process remains the government’s deteriorating cash position.

As well as the IMF payment on Thursday, Greece is due to auction €1.4bn of T-Bills on Wednesday to pay off a maturity next week. With over half of the T-Bill owned by foreign investors, who may be unwilling to roll, pressure will be on domestic funding to ensure the maturity is fully repaid. George maintains his expectation on the ultimate outcome of the crisis being the same as outlined a few weeks ago, this being a roughly equally probability ascribed to: (i) an agreement that would likely require a change in parliamentary coalition/MP support to pass through Greek parliament, (ii) a referendum on the agreement that would be reluctantly backed by the government but ultimately be supported by most political parties, or (iii) a breakdown in talks due to a lack of progress. For now, all eyes on Wednesday’s T-Bill auction and Eurogroup Working Group meeting.

As well Greek headlines and China data this week, Q1 earnings season will likely provide some near term direction to markets with Alcoa due to unofficially kick things off on Wednesday. Last week we highlighted that profits for S&P 500 companies are expected to decline 5.8% in the first quarter, with a weakness in energy stocks and a strong Dollar likely being the themes. In fact, data shows us that profits are expected to decline for the first three quarters of this year. History tells us that for periods of nine months or more of earnings declines, a bear market was the end result in 82% of cases over the past eight decades.

Elsewhere, geopolitical news continues to bubble away in the background. Thursday evening saw an announcement that a ‘framework’ had been agreed upon in the Iran nuclear talks. Drastic cuts in its nuclear program were agreed in return for a gradual lifting in sanctions. However Israel strategic affairs minister Steinitz criticized the deal, saying that the accord makes ‘irresponsible concessions’. Steinitz also commented that the deal didn’t do enough to make Israel comfortable and called for changes to be made to the agreement including ceasing all nuclear R&D activity and a full removal of uranium stockpiles. US President Obama has since dismissed Israel’s comments, quoted in the NY Times yesterday saying that the deal is a ‘once in a lifetime opportunity to see whether or not we can at least take the nuclear issues off the table’.

The crisis in Yemen continues also. Over the weekend we heard that Saudi Arabia had asked Pakistan to contribute soldiers to help with the military campaign with Pakistan’s defense minister quoted on Bloomberg saying that their parliament is debating the request. In the meantime, Bloomberg is also reporting that the rebel-Houthi movement is prepared to resume talks to resolve the crisis, should the Saudi-led coalition stop airstrikes. The same article also notes however that the rebels will not accept the Kingdom-backed deposed President to return to power.

Taking a look at the early morning trading in Asia, equity markets are appearing to follow the US lead as we go to print. Indeed, the Nikkei (+1.26%), Shanghai Comp (+1.80%) and ASX (+0.34%) are all higher. The Aussie Dollar is +1.23% versus the US Dollar after the RBA decided to keep rates on hold at 2.25%. The Central Bank did however hint that it would keep an easing bias for the remainder of the year. Credit markets in Asia are generally 1-1.5pts firmer this morning also.

Despite the holiday shortened week and usual post payrolls data vacuum in the US, there’s still plenty for us to look forward to this week. We kick off in Europe this morning with the final March services and composite PMI indicators for the Euro-area as well as regionally in Germany and France. Preliminary readings are also scheduled in the periphery and the UK. Over in the US this afternoon we’ve got more employment data due in JOLTS job openings while consumer credit and the IBD/TIPP economic optimism readings are expected. Wednesday starts in Japan where the BoJ meeting and trade data for February will be worth keeping an eye on. In the European timezone, German factory orders, French trade data and Euro-area retail sales are the highlights. There is little due in terms of data in the US however the highlight will of course be the release of the FOMC minutes from the March 17th/18th meeting. However will they be seen as out of date post-payrolls. Moving on, Thursday again starts with more central bank focus with the BoE meeting due as well as the UK's trade data. German trade data, along with industrial production will also be due up while in France we get the business sentiment reading. Over in the US on Thursday the highlights are wholesale inventories and initial jobless claims. Approaching the end of the week, Friday’s highlights in the Asia timezone will be on the monthly China data dump which includes CPI, PPI and money supply data. In Europe meanwhile, industrial and manufacturing production for the UK and France will be the main highlights. It’s a light end to the week in the US with just the import price index and monthly budget statement due. Fedspeak wise we’ve also got Kocherlakota and Lacker due to comment over the week. Of course, Greece will likely continue to generate headlines with the IMF payment due and talks with European officials ongoing. Wednesday also see’s the start of Q1 earnings season with Alcoa unofficially kicking off the process. So plenty for us to keep an eye on.