In US economic data, durable goods orders fell by 0.2% in August (survey: -0.3%). New home sales jumped 28.8% in August (survey: -2.2%). The Conference Board consumer confidence index rose from 103.6 to 108 in September (survey: 104.6). The Richmond Fed manufacturing index rose from -8 to 0 in September (survey: -10). S&P/Case-Shiller home prices fell by 0.8% in July (survey: +0.2%). The FHFA house price index fell by 0.6% in July (survey: flat).
European sharemarkets fell on Tuesday, with the continent-wide FTSE Eurotop 100 index down by less than 0.1%. The UK FTSE 100 index slid 0.5% on investor fears about a new economic plan. The British pound recovered from Monday’s record lows on worries about the impact from the UK’s mini-budget.
US sharemarkets were mixed on Tuesday. The S&P 500 index swung between gains and losses, driven by escalating fears of a recession amid aggressive policy tightening by the US Federal Reserve. Shares of McDonald’s restaurants fell by 2.9%, weighing on the Dow Jones index. Microsoft (-0.4%) and Google-parent Alphabet (-0.7%) each dipped for much of the session. But shares of Apple lifted 0.7% with Tesla shares up 2.5% in a choppy trading session.
The Dow Jones index closed lower by 126 points or 0.4%, giving up a gain of almost 400 points earlier in the session. The S&P 500 index slid 0.2%, recording its lowest close in two years. But the Nasdaq index was up 27 points or 0.3%.
Longer-dated US treasuries were weaker on Tuesday (yields higher). Chicago Fed President Charles Evans, St. Louis Fed President James Bullard and Minneapolis Federal Reserve Bank President Neel Kashkari all reiterated the US central bank’s hawkish policy stance. US 10-year yields rose by around 7 points to 12½-year highs near 3.95%. But US 2-year yields eased by around 2 points, hovering near 15-year highs at 4.29%.
Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$0.9666 to lows near US$0.9569 and was near US$0.9590 at the US close. The Aussie dollar dipped from highs near US65.11 cents to lows near US64.13 cents and was near US64.30 cents at the US close. And the Japanese yen fell from near 144.07 yen per US dollar to JPY144.89 and was near JPY144.80 at the US close.
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Global oil prices rose by around 2.5% on Tuesday. Prices rebounded from 9-month lows, supported by supply curbs in the US Gulf of Mexico ahead of Hurricane Ian, as the powerful storm shut-in at least 480,000 barrels of oil production. Bloomberg also reported that Russia is pushing OPEC to cut oil production. The Brent crude oil price rose by US$2.21 or 2.6% to US$86.27 a barrel. The US Nymex crude oil price added US$1.79 or 2.3% to US$78.50 a barrel.
Base metal prices were mostly lower on Tuesday. Copper (-0.1%) extended its downtrend on worries about global growth and demand due to higher interest rates, a stronger US dollar and climbing inventories. Zinc lost 2.1% and nickel slid 1.4%, but tin rose by 0.2%.
The gold futures price lifted US$2.80 an ounce or 0.2% to US$1,636.20 an ounce. Spot gold was trading near US$1,628 an ounce at the US close. Iron ore futures fell by US30 cents or 0.3% to US$98.71 a tonne.
Originally published by CommSec