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Oil eases slightly, Australia's central bank hikes again

Oil prices edged lower on Tuesday after surging a day earlier as investors assessed renewed clashes between the US and Iran around the Strait of Hormuz, while Australia’s central bank raised its key interest rates again and signalled further tightening may be needed. US stock markets closed lower on Monday as higher oil prices and geopolitical tensions weighed on sentiment, while European equities also retreated. In Asia, trading was thin on Tuesday with markets in Japan, China, and South Korea closed for holidays.

  • Data
  • Autore Shane Strowmatt, Senior Investment Writer
  • Tempo di lettura 5 minuto

Oil
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Oil prices edged lower on Tuesday after surging a day earlier, with Brent crude slipping towards USD 113 a barrel and US crude trading near USD 104 as investors assessed renewed clashes between the US and Iran around the Strait of Hormuz. Brent had jumped 5.8% on Monday after Iranian attacks, US military operations to escort vessels through the waterway and a strike on an oil terminal in the UAE raised fresh doubts about the four-week ceasefire. The conflict has pushed Brent up almost 90% this year by disrupting regional supply and keeping Hormuz largely blocked. Gold prices were slightly higher, trading around USD 4540 per ounce on Tuesday, while the US Dollar Index was slightly higher. US Treasury yields fell across the curve, with the two-year yield around 3.9% and the ten-year yield near 4.4%.

RBA raises rates again

The Reserve Bank of Australia raised its policy rate to 4.35% on Tuesday, up from 4.1%, as persistent inflation and higher fuel and commodity prices linked to Middle East tensions kept pressure on prices. The central bank said consumer prices rose 4.1% year-on-year in the first quarter, after monthly inflation reached 4.6% in March, and now expects inflation to average 4.8% in the June quarter and 4% by the end of 2026, both above its previous forecasts. The RBA also signalled further tightening may be needed, with its projections implying a 4.7% policy rate in December, even as it cut its 2026 growth forecast to 1.3% from 1.8%. Australia’s economy grew 2.6% year-on-year in the fourth quarter, its fastest pace in two years, giving policymakers room to continue raising rates. Australia’s S&P/ASX 200 was trading 0.4% lower on Tuesday. Trading elsewhere in Asia was thin, with markets in Japan, China, and South Korea closed for holidays. Hong Kong’s Hang Seng Index was down 1.3% and India’s Nifty 50 lost 0.8%.

US stocks fall on Mideast tensions

US stock indices closed lower on Monday as renewed tensions in the Middle East and higher oil prices weighed on sentiment, with the Dow Jones Industrial Average falling 1.1% to 48,941.90 points, the S&P 500 declining 0.4% to 7200.75 points and the Nasdaq 100 slipping 0.2% to 27,651.82 points after earlier reaching a record high. Video game retailer GameStop said it wanted to acquire online marketplace eBay in a deal valued at about USD 56 billion, sending eBay shares up 5% while GameStop dropped 10.1%. Logistics stocks also came under pressure after technology and e-commerce giant Amazon said it would open its logistics network to other companies, with UPS and FedEx tumbling 10.5% and 9.1%, respectively.

Euro-area factory growth accelerates

Eurozone manufacturing improved further in April, with the S&P Global Manufacturing PMI rising to 52.2 from 51.6 in March, according to data released on Monday, while the output index edged up to 52.3 from 52.0. The survey said stronger demand was driven in part by customers bringing forward orders to build inventories ahead of expected price increases and potential supply disruptions linked to the war in the Middle East, helping lift new orders at the fastest pace in four years. Cost pressures intensified sharply, with input price inflation reaching a near four-year high and selling price inflation climbing to its strongest level since January 2023, while business confidence fell to its lowest since November 2024. Among the big euro-area economies, France and Italy recorded their strongest manufacturing expansions since the first half of 2022, whereas Germany’s growth eased slightly from March. European stock indices closed firmly lower on Monday, tracking the broader risk-off mood. The Euro Stoxx 50 dropped 2.2%, while Germany’s DAX lost 1.2% and France’s CAC 40 fell 1.7%. The Swiss Market Index also declined, shedding 1% on Monday.

Corporate and economic calendar

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Economic data in focus: Swiss Consumer Price Index (08:30), US building permits (14:00), Canadian trade balance (14:30), European Central Bank President Christine Lagarde speaks (14:30), US trade balance (14:30), US Purchasing Managers’ Index (15:45), US new residential sales (16:00), US JOLTS jobs report (16:00), US ISM Services Purchasing Managers’ Index (16:00).

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Editor: Alessandro Fezzi
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