The London interbank offered rate on three-month dollars, a benchmark for more than $300 trillion worth of financial products worldwide, declined to 0.85028 percent from 0.85578 percent on Monday.
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After gaining support from Fed Brainard’s dovish comments, silver prices were put back on the defensive by a fresh slide in bond markets during United States trading Tuesday as volatility spiked higher. Benchmark New York crude was down 6 cents at $44.83 a barrel while the worldwide standard, Brent, fell 33 cents to $46.77 a barrel. The Nasdaq composite lost 65 points, or 1.2 percent, to 5,147. With futures-implied probability of a rate hike in September close to just 20%, it seems investors are becoming more convinced that inflation risk will not manifest for some time yet. The Standard & Poor’s 500 index fell 23 points, or 1 percent, to 2,136.
But the bounce evaporated as Wall Street opened lower and tumbling crude prices on the back of worries over a supply glut sent the sector index down more than 2.8 per cent, making it the worst performer in Europe.
Fears of a September rate hike had sent the three major US stock indexes tumbling on Friday in their worst decline since Britain’s June 23 “Brexit” vote to leave the European Union. The stock was chiefly responsible for the tech sector falling the least, 0.65 percent, among the 10 major S&P sectors. Brent crude, the benchmark for worldwide oil trading, lost 56 cents to $47.76 a barrel in London.
Trends in bond markets will continue to be watched very closely in the short term, with silver vulnerable to further selling if yields continue to increase, especially given the risk of stops, while a strong rally in bonds would underpin silver. Verizon shed $1.12, or 2.1 percent, to $51.45 and AT&T fell 74 cents, or 1.8 percent, to $39.97.
The recent surge to record highs have left stock with high valuations. Heating oil sank 2 cents to $1.42 a gallon. Thai stocks climbed 1.4 per cent following the worst four-day drop since December 2014.
US stock prices rose following Brainard’s comments while the dollar weakened and yields on USA government debt fell.
The U.S. dollar advanced against a basket of currencies, with the euro near $1.123 and the yen around 102.36. The GBP/USD was down 0.43% at $1.3272, with the daily price ranging from $1.3277 to a peak of $1.3342.
Their comments sent United States and European stocks tumbling Friday and hammered Asian equities Monday.
With expectations for a rate rise reduced slightly the dollar dipped against its peers, easing to 101.61 yen from 101.85 yen in NY, while the Australian dollar jumped 0.7 percent and the South Korean won added 0.2 percent.
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Hong Kong’s Hang Seng Index fell 0.3 percent, reversing earlier advances, amid speculation that better-than-expected Chinese economic data will deter policy makers from easing monetary policy.
