A look at the day ahead in European and global markets |
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By Rae Wee, Correspondent |
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The relief rally brought about by U.S. President Donald Trump's postponement of a threat to bomb Iran's power grid didn't even last a day. With Tehran denying it had engaged in negotiations with Washington and global energy supply still crippled, risk sentiment quickly turned sour in Asia on Tuesday and Brent crude futures swiftly bounced back above $100 a barrel. |
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U.S. President Donald Trump walks as he arrives at the White House in Washington, D.C., U.S., March 23, 2026. REUTERS/Kylie Cooper |
Asian shares rebounded slightly in a catch-up rally to their global counterparts from overnight, but U.S. and European futures fell in choppy trade. The dollar clawed back its losses, while U.S. Treasury yields resumed their climb. Even as Trump added five days to his Saturday ultimatum for Iran to reopen the Strait of Hormuz within 48 hours, the situation remains tense and there's been little sign of an imminent end to the Middle East conflict. Iran launched multiple waves of missiles at Israel, the Israeli military said, triggering air raid sirens in parts of the country including Tel Aviv, where blasts from interceptions were heard. |
Graphics are produced by Reuters |
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The prolonged energy shock has also left governments around the world scrambling to secure supplies and finding ways to cut back on demand. Japan plans to start releasing oil from joint stockpiles held by producing nations in the country by the end of March, Prime Minister Sanae Takaichi said in a post on X on Tuesday. South Korean President Lee Jae Myung called for a nationwide energy-saving campaign, saying public institutions would cut back on their use of passenger cars. Meanwhile, traders have offered Iranian oil to Indian refiners at a premium to ICE Brent after Washington temporarily removed sanctions to ease the energy crisis, three industry sources said. Elsewhere in markets, data on Tuesday showed Japan's core consumer inflation slowed below the central bank's 2% target in February for the first time in nearly four years, making the Bank of Japan's communication more difficult as it seeks to raise still-low borrowing costs. Flash PMI readings for the euro zone, the UK and the U.S. are also due later on Tuesday. |
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Key developments that could influence markets on Tuesday: |
- UK, euro zone, U.S. flash PMIs (March)
- ECB's Pedro Machado, Piero Cipollone and Philip Lane speak at separate events
- Fed's Barr speaks
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| Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias. |
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