European and US stocks mostly rose Monday on optimism over increasing economic momentum, but fell in Asia as investors there weighed the risk of inflation with the global economy recovering from the coronavirus pandemic.
With London, Tokyo and Shanghai closed for holiday, traders diverged ahead of more company results and US jobs figures later this week.
John Williams, president of the Federal Reserve's New York branch, predicted the US economy would expand by seven percent this year as it bounces back from the Covid-19 pandemic, its fastest rate since the early 1980s.
Williams also sent another dovish signal on monetary policy, saying the world's largest economy still "has a long way to go" and needs to see several months of strong employment growth to achieve a full recovery.
But earlier, investment giant Warren Buffett instilled some unease after saying over the weekend that he expected the US economy was in "super high gear" thanks to massive Federal Reserve and government support, but that it would fan inflation.
"People have money in their pocket and they're paying higher prices," he said, and there was more inflation than expected six months ago.
Worries about a sudden price increases pose a challenge for stocks in the coming period, even as investors remain broadly optimistic about improving economic conditions in the United States.
Markets also are keeping an eye on the coronavirus crisis in India, where there have been some 20 million cases, overwhelming much of the country's health system.
Still, both the Dow and S&P 500 finished with gains, although the Nasdaq sagged.
Paris and Frankfurt ended the day higher.
- Fears of correction -
But Hong Kong and Singapore were down more than one percent, while Taipei shed two percent. There were also losses in Seoul, Mumbai, and Jakarta though Wellington was up. Sydney and Manila were flat.
The losses came despite data showing better-than-forecast jumps in factory activity in Australia, Indonesia, Malaysia and Taiwan.
"Traders believe that it is highly likely that the global stock market, especially the US stock, could face some correction as we have seen three consecutive months of gains," said Naeem Aslam, chief market analyst at AvaTrade.
Investors are also concerned about the rising number of Covid cases in India and how it could affect the global economy, Aslam said.
Traders will be keenly watching the release of US jobs data this week, which will provide the latest snapshot of the world's top economy and its recovery.
Oil prices rose, recovering some of the ground from the roughly two-percent drops they suffered on Friday on concerns that the frightening coronavirus surge in India will hit demand from the huge economy.
- Key figures around 2120 GMT -
New York - Dow: UP 0.7 percent at 34,113.23 (close)
New York - S&P 500: UP 0.3 percent at 4,192.66 (close)
New York - Nasdaq: DOWN 0.5 percent at 13,895.24 (close)
London - FTSE 100: closed for a holiday
Frankfurt - DAX 30: UP 0.7 percent at 15,236.47 (close)
Paris - CAC 40: UP 0.6 percent at 6,307.90 (close)
EURO STOXX 50: UP 0.6 percent at 4,000.25 (close)
Hong Kong - Hang Seng Index: DOWN 1.3 percent at 28,357.54 (close)
Tokyo - Nikkei 225: Closed for a holiday
Shanghai - Composite: Closed for a holiday
Euro/dollar: UP at $1.2066 from $1.2020 at 2100 GMT
Pound/dollar: UP at $1.3907 from $1.3822
Euro/pound: DOWN at 86.71 pence from 87.01 pence
Dollar/yen: DOWN at 109.07 yen from 109.31 yen
Brent North Sea crude: UP 1.2 percent at $67.56 per barrel
West Texas Intermediate: UP 1.4 percent at $64.49 per barrel
-- Bloomberg News contributed to this story --