China’s Shanghai Composite index fell 21.98 points or 0.77 percent to finish at 2,821.67.
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Japan’s Nikkei stock index.N225 slipped 0.5 percent. Hong Kong’s Hang Seng rose 0.1 percent.
WAITING ON THE FED: Investors are watching for clues on whether the U.S. Federal Reserve will raise interest rates next month.
Goldman Sachs sees a 35-per cent chance of a rate hike at the Fed’s June 14-15 policy meeting.
“When I look back at the March economic projections that my colleagues and I put out suggesting for the rest of the year say two or maybe three rate increases this year – and maybe one or two more next year, so three or four next year – I think that’s still about right”, Williams said. Fed Chair Janet Yell will be at a panel event hosted by Harvard University on Friday. Fed branch presidents including those from San Francisco, St. Louis, Dallas, Minneapolis are also slated to speak earlier in the week.
The dollar rebounded against the yen after posting its biggest daily percentage decline against the Japanese currency in more than three weeks on Monday, and was last up 0.68 percent at 109.97 yen, just under its session high of 110.11 yen JPY=.
With economic growth across emerging markets showing fresh signs of flagging – ratings agency Moody’s expects growth in G20 emerging markets to ease to 4.2 percent in 2016 compared to 4.4 percent previous year – investors are growing more bearish on the outlook for stocks.
Toll Brothers shares were up 4.3 per cent at $28.26 as the company’s quarterly revenue beat expectations.
“Gold is under pressure from a generally stronger dollar, notably low imports into India in April and hawkish comments from Harker”, Tai Wong, director of commodity products trading at BMO Capital Markets in NY, said in an e-mail.
Brexit could impact the U.S. economy through several channels including financial market volatility, flight to quality with U.S. Treasury yields falling and the dollar strengthening, he said.
Oil prices gained as investors anticipated a weekly drawdown in USA crude inventories that they hoped would boost prices closer to $50 a barrel.
With the German ZEW economic sentiment coming out significantly lower than expected on Tuesday (6.4 vs 12.1 expected), and the US dollar continuing to surge based on renewed expectations of a near-term Fed rate hike, the EUR/USD has not had much reason to rise as of late.
Benchmark U.S. crude shed 33 cents to $48.08 per barrel on the New York Mercantile Exchange. Domestic new home sales in April jumped to their strongest monthly pace in more than eight years, with prices setting record highs.
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France’s CAC 40 added 1.1 per cent to 4,372.86 in early trading, while Germany’s DAX gained 0.7 per cent to 9,911.97.
