Tuesday, 3 July 2018

  • Asian stocks edged higher on Tuesday, paring some of the sharp losses recorded in the last session.
  • The dollar was supported by trade tensions ahead of looming U.S. and China tariffs.
  • The Reserve Bank of Australia is expected to make its rates decision later in the day.

Asian markets edged cautiously higher on Tuesday, retracing some of the sharp declines seen in the overnight session as stocks tracked gains seen on Wall Street although worries over U.S. trade policy lingered in the background.

The Nikkei 225 advanced 0.22 percent in early trade after steep losses seen in the previous session. In South Korea, the Kospi edged up by 0.29 percent. The S&P/ASX 200, meanwhile, drifted higher by 0.19 percent as the consumer staples subindex surged 1.01 percent, leading gains in the morning. The Dow Jones Industrial Average rose 0.15 percent, or 35.77 points, to close at 24,307.18, the S&P 500 edged up by 0.31 percent to 2,726.71 and the Nasdaq composite outperformed, advancing 0.76 percent to finish at 7,567.69.

Investor jitters over trade concerns also supported the greenback. The dollar index, which tracks the dollar against a basket of currencies, traded at 94.843. The PBOC set Yuan mid-point at the lowest level since Aug. 25, 2017. In response, the offshore Yuan (CNH) fell to lowest level since August 2017. The People’s Bank of China set the Yuan reference rate at 6.6497 today – the lowest level since August 25, 2017. The offshore Yuan (CNH) exchange rate is feeling the heat from the PBOC’s weaker Yuan fix. The CNH has weakened past 6.7 per dollar for the first time since August 16, 2017.

Oil prices climbed on Tuesday after Libya declared force majeure on significant amounts of its supply, but rising overall output from OPEC as well as in the United States was dragging on markets. Brent crude oil futures were at $78.06 per barrel at 0112 GMT, up 76 cents, or 1 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures were up 75 cents, or 1 percent, at $74.69.

Source : Reuters

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