Stocks on edge

In Asian equity markets, trading was volatile with Japan’s Nikkei (N225) paring early gains to add 0.3% after earlier rising as much as 0.9%, while the dollar jumped to a 3-week top on Tuesday. Stock markets in Asia ticked higher as a landmark U.S.-North Korea summit in Singapore raised hopes the bitter foes might be able to strike a deal to end a nuclear stand-off on the Korean peninsula. U.S. President Donald Trump said he had forged a “good relationship” with North Korean leader Kim Jong Un at the start of their historic meeting, just months after they traded insults and tensions in the region over the reclusive regime’s nuclear programs. Kim said the meeting was “a good prelude to peace”, but there was some unease among investors about the outcome of the talks given the tense relations between the two nations.

In currencies, EURUSD stepped back from a three-week high of 1.1840 to be last down 0.2% at 1.1763, while the expectations of an optimistic outcome from the Trump – Kim Summit drove the sentiment across the fx space in Asia, pushing the dollar to a four-day high against its six major pairs. GBPUSD tapped into a new low this week as the pair’s recovery to 1.3471 appears to be over.

In Commodities, gold continues to remain capped under the critical 1,300.00 level as the precious metal has failed to generate a convincing uptrend following a bottoming out at 1,282.00 in late May.

Crude oil rose by 6 cents to 66.16 per barrel, edged up but stopped short of showing directional conviction as traders await guidance on the fate of an OPEC-led production cut scheme, while Brent dipped 1 cent to 76.45.

For today important economic releases include the Average Earnings Index 3m/y affecting mainly the GBP.