|
 Russian markets were also jittery after a cut to the country's
sovereign credit rating.
Investors will be keen to hear the Fed's response to the recent
policy easing by global central banks such as the European Central
Bank, whose long-awaited plan to buy bonds to revive the flagging
euro-zone economy has propelled bond yields and the euro to
multi-year lows and stocks to multi-year highs.
Although core bond yields held near those lows, lower-rated yields
edged higher after Europe signaled it would not yield to a new Greek
government's demands for debt forgiveness, though it showed a
willingness to give Athens more time to pay its debts. Top Greek
shares were down 2.7 percent.
Credit markets were also jittery beyond the eurozone, with the cost
of insuring exposure to Russia's debt up after Standard & Poor's cut
Russia's sovereign credit rating to "junk" late on Monday, citing
weakened economic growth prospects and Western sanctions.
"A lot of investors have been taken aback by the speed of
macroeconomic adjustments," said Sean Darby, global equity
strategist at Jefferies. "This is not the type of environment they
like to invest in."
The pan-European FTSEurofirst 300 equity index was down 0.2 percent.
European heavyweights Philips and Siemens were among those reporting
disappointing earnings or outlook statements, while in the U.S.
Microsoft Corp reported a fall in quarterly profit.
"Today's earnings show that global demand remains the big issue.
Companies can take advantage of low rates, they can buy back stock
but they cannot create demand and they will get hurt by global
currency wars," said Lex Van Dam, hedge-fund manager at Hampstead
Capital.
Most Asian share markets firmed on Tuesday. The euro clung to rare
gains, up 0.9 percent to trade at $1.13455, taking it further from
an 11-year trough of $1.1098 hit on Monday.
Investors widely expect the Fed to acknowledge the uncertain global
outlook and stick to its promise to be patient on tightening. Yet
its timetable remains for lift-off on rates by mid-year, a
trajectory that presages further broad-based gains for the dollar.
[to top of second column] |
Japan's Nikkei gained 1.4 percent, while Australia's main index
added 0.8 percent. Other moves were mostly modest and MSCI's
broadest index of Asia-Pacific shares outside Japan was flat on the
day.
Chinese markets continued their recent erratic path and the Shanghai
index slipped 2.2 percent.
On Wall Street, the Dow had ended Monday up a bare 0.03 percent,
while the S&P 500 gained 0.26 percent and the Nasdaq 0.29 percent.
A snow storm engulfing New York is expected to keep many investment
banks and fund managers on skeleton staff, though the main exchanges
all plan to open as usual on Tuesday.
In commodity markets, U.S. crude was quoted 17 cents lower at
$44.97. Brent fell 21 cents to $47.95.
(Reporting by Lionel Laurent; Additional reporting by John Geddie,
Francesco Canepa, Jemima Kelly, Karin Strohecker; Editing by Gareth
Jones)
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