World stocks rose in holiday-thinned trade on Monday, helped by a bounce in oil as concerns over tight supply outweighed recession fears. European stocks rallied 0.8% and Britain’s FTSE rose over 1%, boosted by gains in oil and gas companies.

Oil dropped $1 a barrel earlier on Monday on worries about the global economic outlook, but roared back on data showing lower output from the Organization of the Petroleum Exporting Countries (Opec), and on unrest in Libya and sanctions on Russia.

Ecuador’s oil production has been hit by unrest recently, and a strike in Norway could cut supply this week.

“This backdrop of mounting supply outages is colliding with a possible spare production capacity shortage among Middle Eastern oil producers,” said Stephen Brennock of oil broker PVM.

“And without new oil production hitting markets soon, prices will be forced higher.”

Output from the 10 members of Opec in June fell 100,000 barrels per day (bpd) to 28.52 million bpd, off their pledged increase of about 275,000 bpd, a Reuters survey showed. Brent crude jumped 1.25% to $113.02, while US crude rose 1.2% to $109.76 per barrel.

MSCI’s world equity index gained 0.38% after losing 2.3% last week.

Global equities hit 18-month lows last month on anxiety about rising inflation and interest rates, but have since made minor gains. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.34%.

Chinese blue chips closed 0.7% higher, helped by a 4.65% surge in Chinese healthcare stocks. Cities in eastern China tightened COVID-19 curbs on Sunday amid new coronavirus clusters.

Japan’s Nikkei added 0.84%.

US S&P 500 futures and Nasdaq futures fell 0.4% and 0.5% respectively, however, as recent soft US data suggested downside risks for this week’s June payrolls report. US stock markets are shut for Independence Day on Monday.

“Some markets are starting to find their footing but there’s a lot of volatility right now,” said Sebastien Galy, senior macro strategist at Nordea Asset Management.

The Atlanta Federal Reserve’s much watched GDP Now forecast slid to an annualised -2.1% for the second quarter, implying the country was already in a technical recession.

The payrolls report on Friday is forecast to show jobs growth slowing to 270,000 in June, with average earnings slowing a touch to 5.0%.

Minutes of the Fed’s June policy meeting on Wednesday are expected to sound hawkish, however, given the committee chose to hike rates by a super-sized 75 basis points.

The market is pricing in around an 85% chance of another hike of 75 basis points this month and rates at 3.25-3.5% by year end.

But asset manager Nuveen sees room for optimism after sharp market falls in the first half.

“Beaten-down public markets offer extremely compelling upside potential in the near term,” its Global Investment Committee said in its mid-year 2022 outlook on Monday.

Cash Treasuries were shut but futures extended their gains, implying 10-year yields were holding around 2.88%, having fallen 61 basis points from their June peak.

German 10-year government bond yields, the benchmark for the euro zone, rallied 10 basis points to 1.328% after plunging last week as investors rushed to safe-haven bonds. Bond yields move inversely to price.

The US dollar ticked 0.06% lower to 104.99 against a basket of currencies, moving away from recent 20-year highs reached due to its safe haven status.

The euro gained 0.13% to $1.0442, heading away from its recent five-year trough of $1.0349. The European Central Bank is expected to raise interest rates this month for the first time in a decade, and the euro could get a lift if it decides on a more aggressive half-point move.

The dollar gained 0.3% to 135.48 yen, after reaching a 24-year top of 137.01 last week.

A high dollar and rising interest rates have not been kind to non-yielding gold, which was down 0.15% at $1,808 an ounce , after hitting a six-month low at $1,784 last week.

 The euro and sterling rose on Monday against safe-haven currencies, supported by improved global risk sentiment in a quiet trading session due to a holiday in the United States.

European stocks and Britain’s FTSE share index rallied on Monday, helped by gains in oil and gas companies. U.S. markets are closed for Independence Day.

Sterling and the euro gained some ground against the US dollar, the Japanese yen and the Swiss franc .

The single currency rose 0.2% to $1.0440 against the dollar, but stayed barely above May’s five-year trough of $1.0349, while sterling rose 0.4% to $1.2143 after hitting a two-week low of $1.1976 on Friday.

“Quiet trading to start the week is seeing the U.S. dollar weaken against most major currencies as it unwinds Friday’s gains,” said Shaun Osborne, chief FX strategist at Scotiabank.

Reports that the White House will announce an easing of some Chinese tariffs later this week in an attempt to dampen elevated inflation helped inject some optimism back into markets, Osborne added.

But amid fears of a global recession, the euro remained near a five-year low against the dollar.