* Deutsche Bank shares fall 8 pct on capital increase
* Geopolitics, Trump cool risk appetite
* Oil markets see-saw on Iraq comment, IEA forecast
By Herbert Lash
NEW YORK, March 6 Key world equity markets fell
on Monday as U.S. President Donald Trump's allegations that he
was wiretapped by his predecessor dimmed the prospects for U.S.
tax reform plans, while the dollar rose on improved chances an
anti-EU candidate will become France's president.
Trump offered no evidence when he alleged, in a series of
tweets on Saturday, that President Barack Obama had wiretapped
him. That, combined with rising scrutiny of his campaign's ties
to Russia, put a damper on investor enthusiasm for stocks.
Alain Juppe, who served as French prime minister from 1995
to 1997, said he would not seek his country's presidency in
April elections, a development seen as likely boosting the
candidacy of far-right party leader Marine Le Pen.
A poll last week showed that if Juppe replaced the
scandal-hit Francois Fillon as candidate, he would likely win
the election's first round of voting in a scenario that would
likely have knocked the anti-European Union Le Pen out of the
The news sent the euro 0.34 percent lower to $1.0584
while the dollar rose against an index of six major world
currencies by 0.13 percent to 101.670.
Stocks on Wall Street fell, following a retreat in European
shares that were weighed by a fall in Deutsche Bank shares. The
German lender had unveiled an 8 billion-euro cash call as part
of a major reorganization.
Deutsche Bank closed down 7.89 percent, making
the stock the biggest drag to the FTSEurofirst 300 index
. The pan-European gauge of leading regional shares
closed down 0.54 percent at 1,472.94.
European stock market losses were limited by fresh
deal-making activity in the auto and asset management sectors,
which helped the index stay less than 1 percentage point below a
15-month peak hit last week.
MSCI's all-country index of worldwide stocks
fell 0.17 percent as concerns about Trump's ability to see his
economic agenda through weighed on equity markets.
"The market has rallied significantly on the idea that some
of the Trump business proposals, particularly the tax proposals,
would be implemented," said Rick Meckler, president of hedge
fund LibertyView Capital Management LLC in Jersey City, New
"Distractions over the weekend cause people to rethink
whether the administration will be bogged down in other issues,"
The Dow Jones Industrial Average fell 40.85 points,
or 0.19 percent, to 20,964.86. The S&P 500 lost 7.45
points, or 0.31 percent, to 2,375.67 and the Nasdaq Composite
dropped 20.66 points, or 0.35 percent, to 5,850.10.
Oil prices see-sawed after Iraq's oil minister said the
Organization of the Petroleum Exporting Countries would likely
need to extend its production cuts into the second half of 2017.
Those remarks were tempered by a forecast of potential shale
oil growth from the U.S. International Energy Agency.
Crude has been range-bound for more than 60 days,
constrained by concerns that U.S. output may counter OPEC's
agreement to reduce output during the first half of the year.
Brent crude rose 6 cents to $55.96 a barrel while
U.S. crude fell 11 cents a barrel at $53.22.
U.S. Treasury prices fell. The benchmark 10-year Treasury
yield was down 1/32 to yield 2.4961 percent.
In Europe, high-grade euro zone government bond yields edged
lower on expectations the European Central Bank will maintain
its ultra-loose monetary policy stance this week.
Germany's benchmark 10-year Bund yield fell 1.2 basis points
to 0.345 percent, off a two-week high hit on
(Reporting by Herbert Lash; Editing by Bernadette Baum)