* European shares dip but Britain's FTSE hits record high
* Wall Street seen opening lower after Friday's record highs
* Sterling falls vs dollar and euro after PM May's Brexit
* Oil falls on signs of U.S. output growing
* Graphic: World FX rates in 2016: tmsnrt.rs/2egbfVh
By Nigel Stephenson
LONDON, Jan 9 The dollar edged up on Monday,
boosted by robust U.S. wage growth data that strengthened the
case for more U.S. interest rate rises, while Britain's pound
fell on comments by Prime Minister Theresa May seen as pointing
to a "hard" Brexit.
Britain's blue-chip FTSE 100 index nonetheless hit a
record high as the first full trading week of 2017 on London
markets began. The pan-European STOXX 600 index dropped
0.5 percent in early deals.
Wall Street, which hit record highs on Friday, also looked
set for a cautious start, with index futures
lower as oil prices fell.
Britain's pound was the big mover on currency markets,
falling 1 percent against the dollar and the euro, in reaction
to weekend comments from May that were interpreted as suggesting
that she would prioritise reducing immigration over access to
the European Union single market when Britain leaves the EU.
"The rise in the FTSE is really down to the weakness in
sterling, but the Brexit news is not great so I don't see the
FTSE gaining too much," said Ipek Ozkardeskaya, market
strategist at London Capital Group.
In Asia, MSCI's ex-Japan Asia-Pacific shares index
was up 0.1 percent, having earlier risen as much
as 0.5 percent. Australia's S&P/ASX200 rose 0.9 percent
while Hong Kong shares rose 0.2 percent.
Trading was light because Japan was shut for a holiday.
A focus for the week will be a news conference on Wednesday
at which U.S. President-elect Donald Trump may give more details
of the policies he will seek to implement after he takes office
on Jan. 20.
Expectations of more economic stimulus from a Trump
administration have helped to boost U.S. stocks and bond yields.
The Dow Jones Industrial Average came within one
point of the 20,000 mark for the first time on Friday while the
S&P 500 and Nasdaq hit record highs.
Friday's closely-watched U.S. employment report showed that
fewer jobs were created last month than forecast, although a
rebound in wages pointed to economic strength and set the stage
for more Fed hikes later in the year.
The dollar index, which measures the greenback
against a basket of currencies, rose 0.1 percent on Monday. The
euro weakened marginally to $1.0525 while the yen
rose 0.3 percent to 116.64 per dollar.
Sterling fell 0.9 percent to $1.2166, having
touched its lowest since late October at $1.2122, and weakened
more than 1 percent against the euro to an eight-week
low of 85.65 pence.
This followed comments from May that she was not interested
in keeping "bits of membership" of the European Union when
Britain leaves - even though she said on Monday that she had
said nothing new in Sunday's interview.
"May saying that it's not about keeping 'bits' of the EU
suggests it's not going to be about keeping access to the single
market," said HSBC currency strategist Dominic Bunning.
The German 10-year government bond yield, the
benchmark for euro zone borrowing costs, last stood at 0.28
percent, down 1.5 basis points on the day.
It earlier rose close to 0.33 percent, its highest since
Dec. 19, after data showed German exports rose 3.9 percent in
November, their strongest monthly gain since May 2012 and far
ahead of forecast.
Oil prices fell on signs of growing U.S. production
outweighing optimism that other producers were sticking to a
deal to cut output to bolster prices.
Brent crude, the international benchmark, last
traded at $55.96 a barrel, down $1.14 cents or 2 percent.
"We see the optimism surrounding OPEC and non-OPEC
production cuts being counterbalanced by fears of higher U.S.
crude production as the higher rig count of last Friday still
weighs," said Hans van Cleef, senior energy economist at ABN
For Reuters Live Markets blog on European and UK stock
markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets
(Additional reporting by Saikat Chatterjee in Hong Kong, Jemima
Kelly, Marc Jones, Dhara Ranasinghe and Karolin Schaps in
London; Editing by Kevin Liffey)