Tuesday 06:00 BST
Overview
Stocks across Asia were mixed on Tuesday as investors grappled with Wall Street’s lowest level of volatility since before the financial crisis amid a holiday-interrupted week.
European bourses are expected to open higher, with spreadbetters predicting the UK’s FTSE 100 will climb 26 points to 7,230 and Germany’s Dax to gain 22 points to 12,460. US index futures suggest the S&P 500 will gain 1.5 points to 2,389.8, when trading gets under way later in New York.
Hot topic
Wall Street’s preferred fear gauge slid on Monday to its lowest close since mid-February 2007. The Chicago Board Options Exchange implied volatility index finished at 10.11, and at one point traded below the 10-point mark for the second time this year.
The low volatility helped push the Nasdaq Composite to its sixth consecutive record high close, and the S&P 500 up by 0.2 per cent.
The Vix has quickly returned to near-record lows after heightened volatility sparked by geopolitical events in the past year — such as the Brexit vote, the US election and France’s presidential vote.
Equities
Japan’s Topix was up 0.7 per cent, while Australia’s S&P/ASX 200 was down 0.4 per cent owing to a bad day for the banks. ANZ Banking Group lost 2.5 per cent — retreating from a record high — after the lender reported a half-year profit that missed analysts’ expectations.
South Korea’s Kospi was eyeing a record high with a gain of as much as 1.1 per cent to 2,229.7 in morning trade. To ensure that achievement, the benchmark needs to close above 2,228.96, struck precisely six years ago. Shares in Samsung Electronics, the index’s heavyweight, were up 0.9 per cent at a record high.
After returning from a long weekend, Hong Kong’s Hang Seng was up 0.2 per cent and China’s Shanghai Composite was fractionally lower.
Singapore’s Straits Times index was up 0.9 per cent, led by the major banks after DBS reported a rise in net profit during its first quarter.
UK, German and French markets were closed on Monday for public holidays.
Forex
The dollar index, a measure of the US currency against a basket of global peers, was 0.1 per cent lower at 99.022, continuing to wallow in the wake of Friday’s disappointing US gross domestic product data for the March quarter.
The Japanese yen was the weakest of the major currencies, down less than 0.1 per cent at ¥111.88 per dollar. The Korean won and the New Taiwanese dollar were the best of the bunch, chalking up gains of 0.8 per cent and 0.7 per cent, respectively. Data earlier on Tuesday gave a mixed reading of inflation and their manufacturing sectors.
The Australian dollar was up 0.2 per cent against its US counterpart ahead of this afternoon’s central bank policy meeting.
Commodities
Oil prices continued to slide as investors fretted about rising supply. Brent crude, the international benchmark, was down 0.1 per cent at $51.49 a barrel, while West Texas Intermediate slid 0.1 per cent at $48.77.
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