Stocks rebound, gold tumbles on tempered Mideast fears

World stocks recovered some losses on Monday and gold fell by the most in a year, dropping with government bond prices and oil as investors reversed some defensive positions taken going into the weekend on fears of a wider Middle East conflict.

The week ahead is packed with corporate earnings, with 158 companies in the S&P 500 and 173 companies in the STOXX 600 reporting first quarter results this week, according to data from LSEG Workspace.

These include several big European banks, as well as US tech giants Microsoft and Alphabet, with the latter in particular focus after chip maker Nvidia's 10 per cent drop on Friday, its biggest percentage fall in four years.

"The big picture in equities is that they have been able to digest this push back in rate expectations," said Karim Chedid, Blackrock's chief investment strategist for ishares EMEA.

"Now earnings have to deliver for them to continue to do well."

Ahead of all that, shares rose on Monday, with the STOXX 600 up 0.4 per cent and S&P 500 futures 0.6 per cent higher after MSCI'S broadest index of Asia Pacific shares outside Japan rose 0.87 per cent. All fell on Friday.

London's commodities-heavy FTSE-100 rose around 1.66 per cent , the biggest gainer among large European benchmarks.

Gold dropped 2 per cent to $2,341.9 an ounce, its biggest daily percentage fall in over a year, though it is still not too far from its April 12 record high of $2,431.29.

The dollar index, which measures the currency against six major peers, rose 0.19 per cent to 106.28.