EQUITIES
Shares in the Asia-Pacific were mixed on Tuesday after sharp falls to start the week following Fed Chair Jerome Powell’s hawkish speech in Jackson Hole.
Japan's Nikkei stock index rose 1.17%, in part helped by a fresh round of weakness in the Japanese yen. The KOSPI in South Korea added 0.99% and in Australia, the S&P/ASX 200 was 0.47% higher.
Hong Kong's Hang Seng index fell 0.56% as investors start to walk back their enthusiasm about an agreement struck between China and the US for access to Chinese companies audit papers. In mainland China market, the Shanghai Composite shed 0.42%.
Overnight in the U.S., the Dow Jones Industrial Average fell 0.57%, to 32,098.99, the S&P 500 lost 0.67%, to 4,030.61 and the Nasdaq Composite dropped 1.02%, to 12,017.67.
OIL
Oil prices remain supported on Tuesday on the prospect of output cuts, though paring some gains as the market feared that more aggressive interest rates hike from central banks may lead to a global economic slowdown and soften fuel demand.
Brent crude futures rose 0.55%, to $104.53 a barrel after climbing 4.06% on Monday, the biggest increase in more than a month.
U.S. West Texas Intermediate crude was at $96.93 a barrel, was traded flat following a 4.24% rise in the previous session.
Traders look ahead to a release data on U.S. crude inventories data. The American Petroleum Institute, an industry group, is due to release data on US crude inventories on Tuesday with the Energy Information Administration, the statistical arm of the US Department of Energy, to follow on Wednesday.
CURRENCIES
Benchmark 10-year yields fell to 3.089%, down from 3.13% on Monday. The two-year yield fell to 3.429%, after rising as high as 3.489% on Monday, its highest since late 2007.
The dollar index steadied after an overnight dip. It stood at 108.745, after dropping back from 109.48 overnight, a level not seen since September 2002. The dollar struggled to regain momentum on Tuesday after being beaten back by a reinvigorated euro.
GOLD
The recent rise of the dollar and yields has depressed gold. Spot gold fell 0.25% to $1,723.50 an ounce, having hit a one-month low of $1,719.56 in the previous session. U.S. gold futures was down 0.23% at $1,745.70.
Spot silver fell 0.4% to $18.66 per ounce, platinum shed 0.8% to $857.35, and palladium rose 0.3% to $2,152.14.
ECONOMIC OUTLOOK
Shares was mixed on Tuesday. Global market sentiment is to remain cautious, on the back of persistent concerns over interest rate hikes going forward, as the U.S. Federal Reserve stands firm on its hawkish stance.
At the Jackson Hole central banking conference in Wyoming, the U.S. Federal Reserve and the European Central Bank struck a hawkish note, pledging all efforts to tame stubbornly high inflation even if growth takes a hit. Money market traders are now largely pricing in a 75-basis-point interest rate hike at the Fed's September meeting, which would be the third straight hike of that magnitude. They expect the Fed funds rate to end the year at about 3.7%.
Investors turned their focus to this week's U.S. labour market report, to gauge if interest rate hikes that have been priced in around the world are justified. U.S. non-farm payrolls data is due on Friday, and markets may not like a strong number if it supports the basis for a continuation of aggressive interest rate hikes. Any signs of a slowdown in the labour market might take pressure off the Fed to continue with outsized rate hikes.
