In Asian Equity Markets stocks were largely up on Tuesday morning ahead of a looming interest rate hike from the U.S. Federal Reserve. Japan stocks were lower after the close on Tuesday, as losses in the Mining, Steel and Electrical/Machinery sectors led shares lower. At the close in Tokyo, the Nikkei 225 declined 0.24 percent. South Korea’s KOSPI gained 0.23 percent. In Australia, the ASX 200 edged up 0.12 percent. Hong Kong’s Hang Seng Index was up 1.38 percent. China’s Shanghai Composite was up 0.54 percent while the Shenzhen Component was up 0.69 percent.
In Currency Markets the dollar held just below multi-decade peaks on Tuesday as traders awaited a rate hike from the U.S. Federal Reserve but wondered whether hints of a slowing economy may prompt a shift away from its focus on inflation. The euro rose 0.21 percent to $1.0240 but was hemmed in by uncertainty over Europe’s energy security, which is not helped by a looming cut in the westbound flow of Russian gas. The yen steadied at 136.43 per dollar. The Aussie hit a one-month high of $0.6984 and last traded $0.6970.
In US Equity Markets the S&P 500 see-sawed on Monday and ended close to unchanged as investors girded for an expected rate hike at a Federal Reserve meeting this week and earnings from several large-cap growth companies. The Dow rose 0.28 percent, to 31,990.04, the S&P 500 gained 0.13 percent, to 3,966.84 and the Nasdaq Composite fell 0.43 percent, to 11,782.67. Newmont Corp fell 13.2 percent after the miner raised its annual cost forecast and missed its second-quarter profit, hurt by lower gold prices and inflationary pressures.
In Commodities Markets oil prices rose about $2 on Monday, bolstered by supply fears, a dip in the U.S. dollar and early strength in equity markets, but prices seesawed as some worried fuel demand could weaken if the Fed raises U.S. interest rates too aggressively. Brent crude futures for September settled up 1.9 percent, at $105.15 a barrel, while U.S. WTI crude futures rose 2.1 percent, to settle at $96.70 a barrel. Spot gold was up 0.1 percent at $1,728.89 per ounce. Spot silver rose 0.2 percent to $18.62 per ounce. Spot platinum rose 0.4 percent to $877.33, while palladium fell 1.2 percent to $2,007.56.
In European Equity Markets Germany’s DAX index fell on Monday after Russia’s Gazprom said a new turbine halt will further cut gas to Germany via the Nord Stream 1 pipeline, stoking supply worries, while a mixed batch of earnings raised concern about overall economic growth. The pan-European STOXX 600 index closed up 0.1 percent after struggling for direction in the entire session. Banks, which benefit in a high interest rate environment, rose 1.7 percent and helped lender-heavy main indices in Spain and Italy rise, outperforming regional peers.
In Bond Markets U.S. Treasury yields edged slightly higher on Monday as investors awaited the Federal Reserve’s likely 75 basis point interest rate increase later this week amid growing concerns about an economic slowdown and the potential for recession. The two-year Treasury yield rose 4.2 basis points to 3.033 percent, a bit higher after the sale of $45 billion in two-year notes, while the 10-year’s yield was up 3.9 basis points at 2.820 percent, or basically steady after the auction. The yield on the 30-year Treasury bond rose 5.4 basis points at 3.050 percent.