LONDON – European stocks opened higher on Monday while US futures also traded in the black in a tentative rebound from last week when the spread of the COVID-19 Omicron variant and expectations of tighter US monetary policy rocked global markets.

Optimism in Europe overcame a rough session in Asia where the MSCI index of Asia-Pacific shares outside Japan lost almost 1 percent.

The mood was more upbeat moving West with the pan-European STOXX 600 up 0.7 percent and S&P 500 futures adding 0.5 percent.

Ten-year US yields were also rising back above 1.38 percent after losing almost 13 basis points last week.

November's mixed US jobs report did little to shake market expectations of more aggressive tightening by the Federal Reserve.

As uncertainty runs high over the human and economic cost expected from the Omicron variant, investors are focusing on rising US inflation which could prevent the Fed from coming to the rescue should market mayhem re-emerge.

"By severely limiting the FOMC's ability to respond to downside risks posed by Omicron, inflation has effectively destroyed the Fed put," Jefferies analysts said in note.

Inflation is "now the dominant driver of not only rates, but all risk assets", they added as traders wait for Friday's US consumer price report.

The US dollar index ticked up 0.05 percent in European morning trading after hitting brief 13-month peaks against the Australian and New Zealand dollars which both later rebounded.

The euro eased a touch to $1.1289 , still well above its recent trough at $1.1184.

Bitcoin was down 2.8 percent and was last at $48,060. It hit a low of $41,967 over the weekend as profit-taking and macro-economic concerns prompted nearly $1 billion worth of selling across cryptocurrencies. read more

Oil prices rose by more than $1 a barrel after top exporter Saudi Arabia raised prices for its crude sold to Asia and the United States, and as indirect US-Iran talks on reviving a nuclear deal appeared to hit an impasse.

Brent climbed $1.74 to $71.61 a barrel, while US crude added $1.85 to $68.11 per barrel.

Gold prices edged 0.15 percent lower, pressured by the resilient dollar.