Tokyo – Shares were mostly lower in Europe and Asia on Tuesday as investors retreated ahead of the Federal Reserve’s decision on interest rates,AP reports.
KEEPING SCORE: Germany’s DAX fell 0.2 percent to 13,099.40 and the CAC 40 of France lost 0.5 percent to 5,362.83. Britain’s FTSE 100 was flat at 7,455.76. Wall Street looked set for a steady start, with S&P 500 futures flat at 2,665.10 and Dow futures up less than 0.1 percent at 24,434.00.
FEDERAL RESERVE: The Fed is expected to lift short-term interest rates by 0.25 percent on Wednesday, the third interest rate hike by the central bank this year. While inflation has remained low, the central bank has seen a path to gradually raise rates as the economy and labor market have strengthened.
ANALYST VIEWPOINT: Mizuho Bank writes in a commentary that “2018 might be a year that interest rates normalization can finally proceed apace, not only in the U.S., but also the rest of the world,” adding, “The risk is that further policy normalization in the U.S. or Eurozone could either draw capital away from economies that cannot follow the normalization cycle, or prompt some correction in housing prices for those that do follow.”
CHINA: Investors are watching for details from an annual economic planning conference in Beijing that will set the pace for reforms and growth in the world’s second-largest economy. The state-run Xinhua News Agency reported Friday that President Xi Jinping told fellow leaders that the focus should shift to quality of life and improve innovation and competitiveness. Worries over possible moves to curb property market speculation were overshadowing trading on Tuesday.
THE DAY IN ASIA: Japan’s Nikkei 225 index lost 0.3 percent to 22,866.17 while South Korea’s Kospi dropped 0.4 percent to 2,461.00. The Hang Seng index in Hong Kong shed 0.6 percent to 28,793.88. The Shanghai Composite index shed 1.3 percent to 3,280.81. The S&P ASX 200 added 0.3 percent to 6,013.20, but India’s Sensex dropped 0.7 percent to 33,222.91. Other regional markets were mostly lower.
BITCOIN: Bitcoin futures rose on their first day of trading on a major U.S. exchange, with the first-ever futures contract gaining 20 percent to close at $18,545, according to data from Cboe Global Markets. The price of an actual bitcoin has soared since it began the year below $1,000 and was at $16,895.58 as of 09:10 GMT Tuesday, according to Coindesk.
ENERGY: Benchmark U.S. crude gained 53 cents to $58.52 per barrel in electronic trading on the New York Mercantile Exchange. It advanced 63 cents, or 1.1 percent, to settle at $57.99 per barrel on Monday. Brent crude, the international standard, climbed 90 cents to $65.59 per barrel. It added $1.29, or 2 percent, to close at $64.69 per barrel in London.
CURRENCIES: The dollar edged down to 113.44 Japanese yen from 113.55 yen late Monday. The euro rose to $1.1784 from $1.1770.