TOKYO (AP) -- Stock markets rebounded in Europe and Asia on Monday after last week's selling sparked by tensions between the U.S. and North Korea. News that Japan's economy expanded at a better-than-expected 4.0 percent annual pace in April-June failed to lift Tokyo's Nikkei 225 benchmark, which sank as the yen stayed firm against the dollar.
KEEPING SCORE: Germany's DAX gained 1.0 percent to 12,135.92 and Britain's FTSE 100 climbed 0.5 percent to 7,349.32. The CAC 40 of France surged 0.9 percent to 5,105.83. Wall Street looked set for gains, with Dow futures up 0.4 percent at 21,933.00 and S&P 500 futures adding 0.6 percent to 2,453.70.
ANALYST'S VIEWPOINT: "Geopolitics was the dominant theme last week and clearly enough reason for investors to increase cash allocations and look for portfolio protection. However, we have seen tensions over North Korea ease off a touch over the weekend, which could offer some relief to the concern from financial market participants," Chris Weston of IG said in a commentary.
NORTH KOREA: The top U.S. military officer warned during a trip to Seoul that the United States is ready to use the "full range" of its military capabilities to defend itself and its allies from North Korea. A spokesman says Marine Corps Gen. Joseph Dunford also told his South Korean counterparts Monday that the North's missiles and nukes threaten the world. That followed fresh threats against North Korea on Friday, when Trump declared the U.S. military was "locked and loaded" and warned North Korean leader Kim Jong Un that he "will regret it fast" if he takes any action against U.S. territories or allies.
JAPAN GROWTH STORY: The world's third-largest economy saw growth accelerate in the last quarter, helped by stronger consumer spending and corporate capital investment. The numbers, the fastest quarterly expansion in over two years, were better than forecast and represented the sixth straight quarter of growth. The economy expanded at a revised 1.5 percent annual pace in January-March.
CURRENCIES: The dollar rose to 109.57 yen from 109.19 yen late Friday. Investors tend to view the Japanese yen as a safe haven in times of crisis, and before the last flare up between President Donald Trump and North Korea it had been trading at about the 111 yen level. The euro slipped to $1.1816 from $1.1823.
THE DAY IN ASIA: Japan's Nikkei 225 stock index sank 1.0 percent to 19,537.10 on selling of shares in export manufacturers whose profits would be hurt by a stronger yen. Hong Kong's Hang Seng index jumped 1.4 percent to 27,250.23 and Australia's S&P ASX 200 surged 0.7 percent to 5,730.40. South Korea's Kospi gained 0.6 percent to 2,334.22 and the Shanghai Composite index advanced 0.9 percent to 3,237.36. Shares in Southeast Asia were mostly higher.
ENERGY: Benchmark U.S. crude lost 4 cents to $48.78 per barrel in electronic trading on the New York Mercantile Exchange. It rose 23 cents to settle at $48.82 a barrel on Friday. Brent crude, used to price international oils, slipped 13 cents to $51.97. It rose 20 cents to $52.10 a barrel in London.