* Benchmark gains 6.2% in January, best on record. * Most major indexes decline on Friday. * U.S. Fed and RBA decision in focus. By Nausheen Thusoo. Australian shares inched lower on Tuesday for a second consecutive day weighed by miners, ahead of U.S. Federal Reserve and local central bank's policy decisions, although the benchmark logged its best January on record.
Recession worries are sending investors into Treasuries and other fixed income investments ahead of the Federal Reserve's first meeting of 2023, even as stocks start the year with a hopeful rally. "Things are coming off the boil here," said Rob Daly, director of fixed income at Glenmede Investment Management.
Asian shares edged down and bonds nursed small losses on Tuesday as investors braced for an eventful week that will include central bank meetings, a slew of earnings reports and key U.S. economic data. Investors broadly expect the U.S. Federal Reserve to raise interest rates by 25 basis points on Wednesday.
International Monetary Fund economists said on Tuesday that Singapore and other Southeast Asian economies are seeing downgrades to their 2023 growth outlooks because slowing global growth will outweigh the positive impact from China's economic reopening.
The Indian rupee eased on Tuesday against a stronger dollar, with investors keeping a close eye on equity markets while they awaited the domestic Union budget and the U.S. Federal Reserve meeting. The rupee fell to 81.67 per dollar by 10:15 a.m. IST, compared to its previous close of 81.4950. The currency is headed for a monthly gain of about 1.3%, relatively less than its peers.
* Positive China data buoys sentiment. * OPEC+ seen sticking with oil output policy at Feb. 1 meeting. * Investors watch for central bank rate hikes. By Laila Kearney and Trixie Sher Li Yap. Oil prices extended losses on Tuesday as the threat of further interest rate increases and continued Russian crude flows cancelled out demand recovery expectations from China.
* Gold set for gain of over 5% in January. * Silver, platinum, palladium set for monthly fall. * Fed policy meeting on Jan. 31 - Feb. 1. By Ashitha Shivaprasad. Gold prices edged up on Tuesday, en route to their third straight month of gains, as the dollar weakened, while market participants awaited the U.S. Federal Reserve policy decision later this week amid hopes of a less-aggressive rate hike.
U.S. wheat, soybean and corn futures were little changed in early Asian trading on Tuesday as caution prevailed across markets ahead of a slew of central bank policy meetings this week, including the U.S. Federal Reserve. FUNDAMENTALS. * The most-active soybean contract on the Chicago Board of Trade was virtually flat at $15.35 a bushel, as of 0237 GMT.
Former Treasury Secretary?Lawrence H. Summers?is keeping his eyes peeled for the "most important number for the week" ahead of the?Federal Reserve's inaugural Federal Open Market Committee meeting this year. What Happened: In a very full economic calendar this week, Summers told Bloomberg TV: "The thing I'm going to focus most on is the Employment Cost Index release on Tuesday."
Indian shares are set to open higher on Tuesday, the final day of Adani Enterprises' mega secondary share sale and a day ahead of the Union budget, with investors also keeping an eye out for interest rate decisions by global central banks later this week. India's NSE stock futures listed on the Singapore exchange were up 0.47% at 17,789 as of 08:11 a.m. IST.
- Asian shares edged down and bonds nursed small losses on Tuesday as investors braced for an eventful week that will include central bank meetings, a slew of earnings reports and key U.S. economic data. Investors broadly expect the U.S. Federal Reserve to raise interest rates by 25 basis points on Wednesday.
China's economic activity swung back to growth in January, after a wave of COVID-19 infections passed through the country faster than expected following abandonment of pandemic controls.
Asian shares traded cautiously and bonds nursed small losses on Tuesday as investors braced for an eventful week that includes central bank meetings, a slew of earnings reports and key U.S. economic data. Investors broadly expect the U.S. Federal Reserve will raise interest rates by 25 basis points on Wednesday.
China's economic activity swung back to growth in January, official data showed on Tuesday, after a wave of COVID-19 infection passed through the country faster than expected following abandonment of pandemic controls. The official purchasing managers' index, which measures manufacturing activity, rose to 50.1 from 47.0 in December, the National Bureau of Statistics said on Tuesday.
* OPEC+ seen sticking with oil output policy at Feb. 1 meeting. * Russian oil supply appears to remain strong. * Investors watch for central bank rate hikes. By Laila Kearney. Oil prices steadied in early Asian trade on Tuesday after falling by more than 2% in the previous session on the threat of further interest rate hikes and continued Russian crude flows.
The International Monetary Fund on Tuesday raised its 2023 global growth outlook slightly due to "surprisingly resilient" demand in the United States and Europe, an easing of energy costs and the reopening of China's economy after Beijing abandoned its strict COVID-19 restrictions.
China's non-manufacturing activity broke into expansion territory for the first time since September 2022, official data showed on Tuesday, as consumption and travel recovered over the Lunar New Year holiday after the lifting of pandemic curbs.
Profits at China's industrial firms fell 4.0% in 2022 from a year earlier, according to data from the National Bureau of Statistics on Tuesday. The NBS did not release figures for December alone. China's economic growth in 2022 slowed to one of its weakest rates in nearly half a century as the economy was hit hard by strict COVID-19 curbs and a property market slump.
The dollar was eyeing a fourth monthly loss on Tuesday as investors reckon a peak in U.S. interest rates could swing into view as soon as this week's Federal Reserve meeting.
China's factory activity rebounded in January, expanding for the first time since September 2022, official data showed on Tuesday, as the "exit wave" from zero-COVID passed through the population and production lines faster than expected. The official manufacturing purchasing managers' index stood at 50.1, compared with a reading of 47.0 in December, the National Bureau of Statistics said.
The International Monetary Fund on Tuesday raised its 2023 global growth outlook slightly due to "surprisingly resilient" demand in the United States and Europe, an easing of energy costs and the reopening of China's economy after Beijing abandoned its strict COVID-19 restrictions.
The dollar was eyeing a
fourth monthly loss on Tuesday as investors reckon a peak in
U.S. interest rates could swing into view as soon as this week's
Federal Reserve meeting.
Gold prices were flat on Tuesday, as market participants held back from making large bets ahead of the U.S. Federal Reserve policy decision. FUNDAMENTALS. * Spot gold held its ground at $1,922.26 per ounce, as of 0032 GMT. * Traders mostly expect the U.S. central bank to scale back rate hikes to 25 basis points at its two-day policy meeting that ends on Wednesday.
South Korea's Samsung Electronics Co Ltd (SSNLF) on Tuesday indicated it has no plan to cut investment in chips this year, even as a weak global economy condemns the industry to its worst downturn in over a decade.
Japanese factories cut output slightly in December, capping the worst quarter for manufacturers since the onset of the COVID-19 pandemic, hit by stalling global demand and rising costs.
* Dec output -0.1% m/m vs forecast -1.2% * Oct-Dec output -3.1% q/q, biggest fall since 2020Q2. * Manufacturers see Jan output flat, Feb +4.1% * Dec retail sales +3.8% y/y vs f'cast +3.0% * Jobless rate, jobs/applicants ratio flat in Dec. By Kantaro Komiya.
Japan's factory output fell 0.1% in December from the previous month, government data showed on Tuesday, versus the median market forecast for a 1.2% drop. Manufacturers surveyed by the Ministry of Economy, Trade and Industry expect output to be flat in January and rise 4.1% in February, the data also showed.
In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.
Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.
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