Global markets update: US stocks decline as banks tumble, investors await Fed’s next move
US stocks declined on Tuesday as shares of beleaguered banks tumbled again and as investors awaited the Federal Reserve’s next move on interest rates.
The US central bank is expected to raise rates by 25 basis points on Wednesday.
The S&P 500 fell 48.82 points, or 1.17%, at 4,119.05 points. The Dow Jones Industrial Average dipped 365.40 points, or 1.09%, at 33,680.41. The Nasdaq Composite lost 132.49 points, or 1.11%, at 12,077.29.
US regional banks extended losses after the seizure and auction of First Republic Bank. Among bank shares, PacWest Bancorp tumbled, along with Western Alliance Bancorp and Comerica Inc.
US treasury yields fell on worries that the government could run out of cash by June without a debt ceiling hike. The yield on 10-year treasury down 13.3 basis points to 3.441%, from 3.574% late on Monday.
Currencies
The US dollar fell to 136.69 Japanese yen from 137.48. The euro rose to $1.1001 from $1.0970.
Canada
The Toronto Stock Exchange’s S&P/TSX composite index ended down 207.54 points, or 1%, at 20,407.56.
Europe
Ahead of key interest rate decision from European Central Bank, stock markets in Europe fell on Tuesday, led by energy shares.
The pan-European STOXX 600 index fell 1.2%, closing at its worst level since early April.
Oil and gas stocks plunged 4.5%, lowest close in over one month.
ECB’s monetary policy decision is expected on Thursday.
Britain’s FTSE 100 dropped 1.3% at 7,773.03. Germany’s DAX fell 1.2% at 15,726.94. France’s CAC 40 slipped 1.5% at 7,383.20.
Asia
Asian equities rose on Tuesday.
Hong Kong’s Hang Seng index gained 0.2% at 19,933.81. South Korea’s benchmark Kospi closed up 22.86 points, or 0.91%, at 2,524.39. Shanghai Composite was closed for holiday.
Japan’s Nikkei 225 rose 0.1% at 29,157.95.
Markets in Taipei, Kuala Lumpur, Singapore and Manila were up.
Australia’s S&P/ASX 200 index ended 0.9% lower at 7,267.4 points. New Zealand’s benchmark S&P/NZX 50 index rose 0.3% to finish the session at 12,0.37.8.
Oil prices
Oil prices fell on worries about a US bond default, weak economic data from China and expectations the US and Europe will raise interest rates again this week.
Brent crude for July delivery fell $3.99 to $75.32 a barrel on Tuesday.
The US crude oil benchmark for June delivery fell $4 to $71.66 a barrel.
Bullion
Gold for June delivery rose $31.10 to $2,023.30 an ounce. Silver for July delivery rose 39 cents to $25.62 an ounce.
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