Marketmind: Markets level, Aussie hikes, crypto judders

[June 06, 2023]  A look at the day ahead in U.S. and global markets from Mike Dolan

As world stock markets levelled off on Tuesday, Australia dampened hopes that central banks were set to pause the interest rate rise cycle, the crypto universe nursed its latest blow, and Apple underwhelmed overnight.

A relatively quiet week for U.S. macroeconomic and market news has investors resting on an assumption the Federal Reserve will skip a rate rise at next week's policy meeting, while considering one last hike in its campaign next month. Soft service sector surveys for May on Monday underlined that idea.

The Reserve Bank of Australia was in no mood to hold off, however. It raised interest rates by a quarter-point on Tuesday to an 11-year high and warned further tightening may be required to ensure that inflation returns to target, boosting the Aussie dollar as markets had been leaning towards a pause.

Eyes will now be trained on the Bank of Canada's latest policy decision on Wednesday, with many forecasting it will resume tightening interest rates after a four-month pause.

Stock and bond markets remained calm, however. S&P500 futures were mostly flat after a mixed start to the week.

Apple's stock retreated a touch after setting a record high on Monday just before an underwhelming launch of its new gadget.

The firm unveiled a costly augmented-reality headset called the Vision Pro in its riskiest bet since the introduction of the iPhone more than a decade ago.

The Vision Pro will start at $3,499, more than three times the cost of the priciest headset in Meta's line of mixed and virtual reality devices.

The crypto world was far from calm, with Bitcoin trying to find its feet after a 5% recoil to three-month lows on Monday.

U.S. regulators sued Binance and its CEO Changpeng Zhao on Monday for allegedly operating a "web of deception", piling further pressure on the world's biggest cryptocurrency exchange.

Zhao Changpeng, founder and chief executive officer of Binance, attends the Viva Technology conference dedicated to innovation and startups at Porte de Versailles exhibition center in Paris, France June 16, 2022. REUTERS/Benoit Tessier

The Securities and Exchange Commission complaint listed 13 charges against Binance, Zhao and the operator of its purportedly independent U.S. exchange. Binance said it "respectfully" disagreed with the SEC's allegations.

But investors have pulled around $790 million from the exchange and its U.S. affiliate in the last 24 hours, data firm Nansen said on Tuesday.

Oil retreated sharply once more despite Saudi Arabia's weekend plans to cut crude output again, with many analysts seeing the solo move as partly a reflection of disagreements within the OPEC cartel.

The euro and euro debt yields slipped back on surveys showing household inflation expectations in the bloc subsiding.

And the yuan slipped lower after reports Chinese authorities had asked the nation's biggest banks to lower their deposit rates for at least the second time in less than a year in an effort to boost the economy.

The dollar was marginally firmer overall.

Events to watch for later on Tuesday:

* U.S. Secretary of State Antony Blinken visits Saudi Arabia

* U.S. corporate earnings: JM Smucker

(By Mike Dolan, editing by XXXX [e-mail]. Twitter: @reutersMikeD)

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