(Bloomberg) – Asian stocks are likely to be mixed open on Tuesday as traders weigh up a surge in crude oil amid an OPEC + crisis that derailed a deal to increase production. One measure for the dollar was stable.
Stock futures rose in Japan and Australia, but fell in Hong Kong. The US stock and treasury markets were closed on Monday for the Independence Day holiday, which kept trading subdued. European stocks rose slightly and US contracts fluctuated in early Asian trading.
OPEC + fell into crisis when a worsening battle between Saudi Arabia and the United Arab Emirates blocked an increase in oil supplies. The break in talks has pushed the price of crude oil to $ 80 a barrel, but it also increases the risk of a price war if the conflict over the alliance escalates.
The Australian dollar rose ahead of a Reserve Bank of Australia meeting. The central bank is expected to cut some monetary support despite ongoing containments against a recent Covid-19 flare-up. The New Zealand currency rallied on expectations of tighter monetary policy.
Higher energy costs could add to inflationary pressures, which reinforce the Federal Reserve’s arguments to curb emergency response measures in the coming months. The Fed’s latest minutes, due on Wednesday, could provide further context on their hawkish turn last month.
Oil risk at $ 100 a barrel “is so correlated with short-term inflation that it will make the market very, very nervous, and we know the Federal Reserve is watching both economic data and the markets,” Alan Higgins, chief investment Officer at Coutts & Co., said Bloomberg Television.
The continued nervousness of China’s cybersecurity crackdown is likely to overshadow the market there. One of the most prominent investigations concerns ride-hailing giant Didi Global Inc., which has just been listed in the USA. The saga threatens to turn China’s largest tech company into a riskier bet.
Elsewhere, the UK announced plans to lift social distancing and capacity restrictions at venues in England from July 19, saying people need to learn to live with the coronavirus. The pound extended an advance.
Here are some events to watch this week:
Fundamental decision of the Reserve Bank of Australia TuesdayFOMC minutes Wednesday The group of 20 finance ministers and central bankers will meet in Venice on FridayChina PPI and CPI data released on Friday
These are some of the key moves in the markets:
S&P 500 futures were little changed until 7:39 a.m. in Tokyo Nasdaq 100 futures were stable The Stoxx Europe 600 rose 0.3% Nikkei 225 futures rose 0.2% Australia’s S&P / ASX 200 index futures rose 0.3% Hang Seng Index Futures Down 0.2%
The Japanese yen was trading at 110.91 per dollar, the offshore yuan was at 6.4635 per dollar, the Bloomberg Dollar Spot Index was a little flat, and the euro was at $ 1.1865
10-year US Treasury futures were little changed
West Texas Intermediate’s crude oil rose 1.4% to $ 76.23 a barrel of gold, which was $ 1,792.50 an ounce
There are more stories like this on Bloomberg.com
Subscribe now to stay on top with the most trusted source of business news.
© 2021 Bloomberg L.P.