Global markets took a breather on Tuesday morning as traders eyed the busy week ahead which includes President Trump’s first State of the Union address tonight and Federal Reserve Chair Janet Yellen’s last policy meeting tomorrow. Declines on Wall Street on Monday sent Asian indexes lower on Tuesday with Japan’s Nikkei 225 index leading the declines. The country’s benchmark index plummeted as much as 1.55 percent in the early afternoon before bouncing back slightly. Hong Kong’s Hang Seng index was down 0.99 percent as of 1:39 p.m. HK/SIN, South Korea’s Kospi was 1 percent lower and the Shanghai Composite was at a 0.63 percent loss. Australia’s ASX was also 0.87 percent in the red.
The widespread losses were lead by declines in the technology sector, prompted by Apple’s overnight decline caused by reports of a decrease in iPhone X production.
Currency Market Movements
The dollar edged up slightly against many of its trading partners on Tuesday afternoon, with the greenback up 0.10 percent against the euro, to $1.2367. The dollar also posted modest gains against the Swiss franc, the Australian dollar and the Canadian dollar. It stalled against the yen, however, down 0.22 percent to 108.71. On Monday, the U.S. Treasury Department announced that it plans to borrow $441 billion through the credit markets in Q1 2018, less than previously expected. U.S. bond yields peaked on Monday at 2.727 percent, the highest since April 2014, bringing renewed interest to the dollar’s yield. Analysts also attribute the rise in bond yields as trader anticipation about the upcoming Fed meeting which will end on Wednesday.
On the commodities markets, U.S. WTI futures were down 1.04 percent to $64.88 per barrel, and Brent crude futures were down 0.71 percent to $68.97 per barrel.