World stocks extended a sell-off on Tuesday as escalating trade tussles between the United States and other major economies steered investors away from riskier assets, with markets in China bearing the brunt of investor anxiety. The tense atmosphere lifted demand for safe-haven U.S. Treasuries and kept the dollar on the defensive as financial markets worried about the wider global economic fallout of the Trump administration’s “America First’ agenda. Asian equities were lower across the board after Wall Street tumbled. Asian tech shares slid after U.S. peers, which derive much of their sales revenue from China, took a battering overnight. “Unlike the seemingly spur-of-the-moment tweets by President Trump and the retaliatory exchange of tariffs, Washington’s bid to protect intellectual property is an issue at the heart of a trade row between two powers battling for future global supremacy,” wrote Yoshimasa Maruyama, chief market economist at SMBC Nikko Securities in Tokyo.
In currencies, the USD/JPY pair dropped 0.26% to 109.48 on Tuesday morning. The new round of moves clouded investing prospects and hampered risk appetite. The yen attracts demand in times of political tensions and market turmoil. The GBP/USD is maintaining a bullish stance for the week, despite still flubbing below Friday’s highs. The current price action is being lifted by a rising channel from last week’s low.
In Commodities, Gold prices edged down on Tuesday despite escalating trade concerns between the U.S. and other major economies. In Oil, the Organisation of Oil Exporting countries (OPEC) decided to raise output on Friday following a key meeting in Vienna. While the decision was widely anticipated, the supply boost was less than some investors had anticipated. The OPEC agreed to a nominal increase in production of 1 million barrels a day. While OPEC members will add around 700,000 barrels a day, non-OPEC oil suppliers led by Russia would add the rest. OPEC and non-OPEC partners including Russia started withholding supply in 2017 and cut output by 1.8 million barrels per day (bpd) to prop up prices.
For today important economic release is CB (The Conference Board Inc.) Consumer Confidence.