Macro Roundup (Jul 6)

SHANGHAI, Jul 6 —This is a roundup of global macroeconomic news last night and what is expected today.

The U.S. dollar was up 0.35% at 136.165 yen, gaining support from a strong rebound in the 10-year Treasury yield, which jumped to 2.9780% in Tokyo on Tuesday from the lowest since May at 2.7910% on Friday.

There was no trading in Treasuries on Monday, with U.S. markets closed for the Fourth of July holiday, which also resulted in thin currency-market trading.

Economists polled by Reuters expect the Reserve Bank of Australia on Tuesday will deliver another half-percentage-point rise in interest rates as it fights to tame inflation at two-decade highs, matching the increase it delivered last month in a hawkish surprise.

The Australian dollar ticked higher on Tuesday ahead of an expected half-point increase in the Reserve Bank’s policy rate, while the yen slid against the greenback amid a rise in U.S. Treasury yields.

U.S. equities futures were flat Tuesday night after the market staged a big midday reversal, with falling bond yields giving a boost to growth stocks, and ahead of a batch of economic data.

Futures tied to the Dow Jones Industrial Average hovered around the flat line. S&P 500 futures and Nasdaq 100 futures were also little changed.

In regular trading, the Dow lost 129 points to start the holiday-shortened week, trimming steeper losses from earlier in the session. The S&P 500 rallied back from a 2% loss in the final hour of trading and finished the day up 0.2%. The tech-heavy Nasdaq Composite outperformed, jumping 1.75%.

Whether the market is about to fall into a recession continued to worry investors after the benchmark 10-year U.S. Treasury yield fell below the 2-year yield. The so-called yield curve inversion historically has been a warning sign that the economy may be falling or has already fallen into recession.

Oil prices tumbled Tuesday with the U.S. benchmark falling below $100 as recession fears grow, sparking fears that an economic slowdown will cut demand for petroleum products.

West Texas Intermediate crude, the U.S. oil benchmark, settled 8.24%, or $8.93, lower at $99.50 per barrel. At one point WTI slid more than 10%, trading as low as $97.43 per barrel. The contract last traded under $100 on May 11.

International benchmark Brent crude settled 9.45%, or $10.73, lower at $102.77 per barrel.

Gold lost more than 2% on Tuesday to sink further below the $1,800 support level as a sharp rally in the dollar and rising interest rates sapped appetite for the non-yielding asset.

Spot gold was last trading down 2.3% at $1,767.55 per ounce, having earlier declined as much as 2.6%. U.S. gold futures settled down 1.9% at $1,766.9 per ounce.

The pan-European Stoxx 600 closed down by 2.1% provisionally, with oil and gas stocks falling 6.3% to lead losses as almost all sectors and major bourses slid into negative territory.