In US economic data, the JOLTs survey showed that job openings rose from 11.04 million to 11.239m in July (survey: 10.45m). Consumer confidence rose from 95.3 to 103.2 in August (survey: 97.7). The S&P/Case Shiller home price index grew at a 18.6% annual rate in June, down from 20.5% in May (survey 19.5%). The Johnson Redbook measure of chain store sales rose at a 14.2% in the past week, up from 13.5% in the prior week.
European sharemarkets were mixed on Tuesday. While most sectors fell, banks rose 0.9% as bond yields continued to climb. Also Reuters noted “Fears lingered about a planned three-day halt of natural gas supplies to Europe by Russian energy company Gazprom via the Nord Stream 1 pipeline which was set to kick off on Wednesday.” After rising 1% earlier in the session, the pan-European STOXX 600 index fell by 0.7%. But while the German Dax index rose by 0.5%, the UK sharemarket fell by 0.9%. Shares in Rio Tinto fell by 3.3% and shares in BHP fell by 4.3%.
US sharemarkets fell for a third straight session on Tuesday. Job openings posted an unexpected rise in July, underlining expectations of further rate hikes from the Federal Reserve. Investors also digested new comments by three Federal Reserve officials. Shares in Best Buy rose 1.6% on a smaller-than-expected drop in sales. At the close of trade, the Dow Jones index was lower by 308 points or 1.0% . The S&P 500 index fell by 1.1% and the Nasdaq index lost 134.5 points or 1.1%.
US short-term treasuries were lower on Tuesday (yields higher). US 10-year yields were flat near 3.11%. But US 2-year yields rose by around 3 points to near 3.46%.
Major currencies were generally weaker against the US dollar in European and US trade. The Euro rose from lows near US$0.9980 to highs near US$1.0055 and was near US$1.0020 at the US close. The Aussie dollar fell from highs near US69.55 cents to lows near US68.45 cents and was near US68.55 cents at the US close. And the Japanese yen eased from 138.00 yen per US dollar to JPY139.05 and ended US trade near JPY138.75.
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Global oil prices fell by 5.5% on Tuesday on on-going fears that higher global interest rates could crimp economic activity and therefore oil demand. Also weighing on oil prices were comments from Iraq’s state-owned oil marketer SOMO that the country’s oil exports had been unaffected by recent unrest in the country. The Brent crude oil price fell by US$5.78 or 5.5% to US$99.31 a barrel. And the US Nymex crude oil price fell by US$5.37 or 5.5% to US$91.64 a barrel.
Base metals fell by as much as 4.5% on the London Metal Exchange on Tuesday with tin down the most while lead was flat.
The gold futures price fell by US$13.40 an ounce or 0.8% to US$1,736.30 an ounce. Spot gold was trading near US$1,725 an ounce at the US close. Iron ore futures fell by US63 cents or 0.6% to US$104.49 a tonne.
Ahead: In Australia, construction work done is released. In China the official purchasing managers index is released. In the US the ADP employment change report is issued with weekly mortgage applications and the Chicago purchasing managers index.
Originally published by CommSec