Asia cautious as everything rides on dovish Powell

Dow Jones

Treasuries retreated after the latest American inflation reading came in hotter than anticipated, while the dollar dropped for a second day and gold slipped. Nvidia Corp. and Apple Inc. anchored a rally in the tech sector.

Oil fluctuated as Tropical Storm Barry menaced American refineries and offshore crude production. While Gold may face some obstacles in the near term, bulls are unlikely to lose any sleep in the medium to longer term given how global growth concerns, ongoing trade developments and geopolitical tensions remain core market themes. Today, the president tweeted that China "is letting us down", which briefly weighed on advances in stock benchmarks.

A worrying lack of inflation globally is one reason investors are counting on Federal Reserve Chair Jerome Powell to sound suitably dovish when he testifies to Congress on Wednesday.

"Inflation appears to have stabilized and this will put a wrench in some Fed rate-cut bet forecasts", Edward Moya, senior market analyst at Oanda, wrote in a note.

Equities across the globe are likely to hold their breath as markets ponder whether Powell would confirm or downplay expectations for a potential U.S. rate cut this month.

The Stoxx Europe 600 Index headed for the first gain in five days, with energy companies leading the way as crude oil prices surged.

The Japanese yen traded at 108.95 against the US dollar after seeing levels below 108.5 earlier in the week In Hong Kong, the Hang Seng index recovered 88.41 points, or 0.3%, to 28,204.69.

The pound rebounded from more than two-year lows versus the dollar, as official data showed Britain's economy rebounded in May, with gross domestic product growth of 0.3% following GDP contraction of 0.4% in April.

The precious metal has made an effort to push back above the $1400 level but this was cut short by investors re-evaluating whether the Federal Reserve will cut interest rates this month.

Indian fans hurt by World Cup exit but proud of team
Boult and Henry shared five wickets while spinner Mitchell Santner claimed two in a tight display to snuff out India's hopes. No one wants to lose a game. "But the way they bowled in that first half an hour was the difference in the game", he said.

United States to probe French plan to tax tech companies
The measure is close to passing both houses of Parliament and could soon be signed by President Emmanuel Macron, who has voiced support for the tax.

Samsung boss visits Tokyo amid Japan-Korea trade scuffle escalation
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Sterling was last quoted at $1.2455 after skidding to a new six-month low of $1.2439 on Tuesday, with Brexit jitters and growing expectations of a Bank of England rate cut adding to the currency's weakness.

An early rally in USA stocks lost some steam after President Donald Trump tweeted a complaint that China is "letting us down" by not buying USA farm products. S&P 500 futures were little changed. The S&P 500 was up 3.68 points, or 0.12 percent, to 2,979.63.

The U.K.'s FTSE 100 Index fell 0.3%, its sixth consecutive decline.

The Bloomberg Dollar Spot Index dipped 0.1% to the lowest in a week.

The British pound stood at 1.2508, not removed from six-month lows of $1.2481 touched on Friday.

The dollar also gained to 108.92 yen, though the brighter French data helped the euro gain to $US1.1225, still down from its $US1.1412 level of just a couple of weeks ago.

The yield on 10-year Treasuries climbed three basis points to 2.09%, the highest in more than three weeks.

Money market futures are still fully pricing in a 25 basis point (bps) cut at the Fed's next policy meeting on 30-31 July, but have nearly priced out a larger 50 bps reduction.



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