In US economic data, new home sales fell from a 0.709 million annual rate to 0.591m in April (survey: 0.75m). The Richmond Federal Reserve manufacturing index fell from +14 to -9 in May (survey: +12). The S&P Global manufacturing index fell from 59.2 to 57.5 in May (survey: 57.5) and services fell from 55.6 to 53.5 (survey: 55.2).

European sharemarkets were lower on Tuesday. The survey of purchasing managers for the euro zone showed slower business activity and more firms reporting shortages of raw materials. Tech stocks fell 2.7% after a profit warning by Snap. But shares in Barclays rose 3.2% on starting a suspended 1-billion-pound share buyback programme. The pan-European STOXX 600 index fell by 1.1%. The German Dax index fell by 1.8% and the UK FTSE index lost 0.4%. In London trade, shares in Rio Tinto fell by 0.4% while BHP shares were flat.

US sharemarkets were mixed on Tuesday. Weighing on sentiment was a profit warning from Snapchat owner, Snap Inc., with its shares sliding 43.1%. Technology stocks were generally lower. Shares in apparel retailer Abercrombie & Fitch fell by 28.6% after posting a quarterly loss and cutting its annual sales and margins outlook. But shares in Zoom Video Communications rose 5.6% after it raised it full-year profit forecast. The Dow Jones index closed higher by 48 points or 0.2% after being down 515 points earlier. The S&P 500 index fell by 0.8%. And the Nasdaq index lost 271 points or 2.4%.

US treasuries rose on Tuesday (yields lower) with bonds favoured as stocks fell. US 10-year yields fell by around 10 points to near 2.76%. And US 2-year yields fell by around 14 points to near 2.49%.

Major currencies were firmer against the US dollar in European and US trade. The Euro rose from near US$1.0660 to highs near US$1.0745 and was near US$1.0735 at the US close. The Aussie dollar held between levels near US70.60 cents and US71.10 cents and was near highs at the US close. And the Japanese yen rose from 127.74 yen per US dollar to JPY126.35 and was near JPY126.87 at the US close.

 

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Global oil prices were mixed on Tuesday. The European Union is moving closer to an embargo on Russian oil. And investors monitored news on Covid cases in China. Weighing on US crude prices, US Energy Secretary Jennifer Granholm said US President Joe Biden had not ruled out using export restrictions to ease soaring domestic fuel prices. The Brent crude price rose by US14 cents or 0.1% to US$113.56 a barrel. But the US Nymex crude price fell by 52 cents to US$109.77 a barrel.

Base metal prices were lower on Tuesday with zinc down less than 0.1% and nickel down the most, lower by 4.3%.

The gold futures price rose by US$17.60 or 1.0% to US$1,865.40 an ounce. Spot gold was trading near US$1,866 an ounce at the US close. The iron ore futures price fell by $1.19 or 0.9% to US$133.10 a tonne.

Ahead: In Australia, data on construction work and skilled job vacancies are released. Reserve Bank Assistant Governor Luci Ellis delivers a speech. In the US, minutes of the last Federal Reserve meeting are released with durable goods orders.

Originally published by CommSec