The Spanish stock index IBEX 35 started the week with slight gains after the US employment report boosted bets that the Federal Reserve may still cut rates this year.

In a session with less movement due to the holidays in Japan and the United Kingdom, the markets focused their attention on the Fed's reaction to the job creation data released on Friday, which was lower than expected.

The data "raises again the expectation of a Fed rate cut in 2024 to 2, with the first in September, as Powell referred to a significant slowdown in the labor market as one of the reasons to start lowering interest rates," said analysts at Renta 4 in a note to clients.

Markets expect cuts of 45 basis points this year, with a November rate cut fully priced in.

On Monday, investors will be watching for the release of final services and composite PMIs in Spain, Germany and the eurozone, as well as eurozone producer prices (0900 GMT).

At 0702 GMT on Monday, Spain's selective IBEX 35 stock market index was up 15.80 points, or 0.15%, to 10,871.00 points, while the FTSE Eurofirst 300 index of large European stocks was up 0.16%.

In the banking sector, Santander rose 0.10%, BBVA fell 0.12%, Caixabank advanced 0.76%, Sabadell gained 1.19%, Bankinter dropped 0.35%, and Unicaja Banco rose 0.24%.

Among the large non-financial stocks, Telefónica gained 0.02%, Inditex gave up 0.54%, Iberdrola gained 0.22%, Cellnex fell 0.21%, and the oil company Repsol rose 0.73%.

Indra soared 5.61%, after reporting a 40% increase in its net profit for the first quarter, supported by strong orders.

(Information by Benjamín Mejías Valencia; edited by Javi West Larrañaga)