In US economic data, factory orders rose by 1.6% in May after rising 0.7% in April (survey: +0.5%).
European sharemarkets were weaker on Tuesday on on-going recession worries. Oil & gas stocks fell by 6.3% while miners lost 5.2% and utilities lost 2%. Shares in SAS fell 10.2% after the Scandinavian airline filed for bankruptcy protection in the US. The pan-European STOXX 600 index fell by 2.1% – the worst session in two weeks. The German Dax index and the UK FTSE index both fell by 2.9%. In London trade, shares of Rio Tinto fell by 4.0% and shares in BHP fell by 3.1%.
US sharemarkets were mixed on Tuesday. Concerns about global growth weighed on the energy sector (down 4.0%) and materials (down 2.0%). Traders await minutes from the June Federal Reserve meeting on Wednesday and the non-farm payrolls data (employment) on Friday. The Dow Jones index fell by 129 points or 0.4%. But the S&P 500 index rose by 0.2% and the Nasdaq index was up by 194 points or 1.8%.
US treasuries rose on Tuesday (yields lower). US 10-year yields fell by around 7 points to near 2.83% and US 2-year yields fell by around 2 points to near 2.83%.
Major currencies were mixed against the US dollar in European and US trade. The Euro fell from highs near US$1.0440 to US$1.0235 and was near US$1.0265 at the US close. The Aussie dollar fell from near US68.75 cents to near US67.60 cents and was near US67.95 cents at the US close. But the Japanese lifted from 136.30 yen per US dollar to JPY135.55 and was near JPY135.85 at the US close.
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Global oil prices slumped by 8-9% on Tuesday on fears that aggressive rate hikes by central banks could cause a global recession. Reuters also reported that “Shanghai said it would begin new rounds of mass COVID-19 testing of its 25 million residents, reigniting worries about potential lockdowns.” And the US dollar strengthened, making dollar-denominated commodity purchases more expensive for buyers in Europe and Asia. The Brent crude price fell by US$10.73 or 9.5% to US$102.77 a barrel. And the US Nymex crude price fell by US$8.93 or 8.2% to US$99.50 a barrel.
Base metal prices were weaker by up to 4.3% on Tuesday with copper leading the way. But nickel was the exception, up 0.6%.
The gold futures price fell by US$37.60 or 2.1% to US$1,763.90 an ounce. Spot gold was trading near US$1,767 an ounce at the US close. The iron ore futures price rose by US$3.48 or 3.2% to US$113.42 a tonne.
Ahead: In Australia, no major economic data is expected. In the US, minutes of the last Federal Reserve meeting is issued with JOLTs job openings and services purchasing manager indexes from ISM and S&P Global.
Originally published by CommSec
