(Alliance News) - Stocks in London are set to open higher on Tuesday, after a mixed session in Asia and the decision by Australia's central bank to pause interest rate hikes.
IG says futures indicate the FTSE 100 index of large-caps to open up 19.81 points, or 0.3%, 7,692.81 on Tuesday. The FTSE 100 index closed up 41.26 points, or 0.5%, at 7,673.00 on Monday.
In Tokyo on Tuesday, the Nikkei 225 index was up 0.3%. The Shanghai Composite was up 0.3%, but the Hang Seng index in Hong Kong was down 1.0%. The S&P/ASX 200 in Sydney closed up 0.1%.
The Reserve Bank of Australia decided to leave interest rates unchanged at its April meeting. The cash rate target remains 3.60% and the interest rate on exchange settlement balances remains 3.50%. The RBA noted the decision follows a cumulative 3.5 percentage point increase to interest rates since May last year.
Market consensus, as cited by FXStreet, had been expected the move, though some analysts had believed a 25 basis point hike also was possible.
"The board took the decision to hold interest rates steady this month to provide additional time to assess the impact of the increase in interest rates to date and the economic outlook," said RBA Governor Philip Lowe.
Lowe went on to say that the bank expects some further tightening of monetary policy "may well be needed" to return inflation to its 2% to 3% target range.
Over in the US, stocks closed mixed on Monday as soaring oil prices pushed blue chips firmly into the green but knocked tech stocks. The Dow Jones Industrial Average ended up 1.0% and the S&P 500 up 0.4%, but the Nasdaq Composite lost 0.3%.
Oil prices jumped after Opec+ nations announced unexpected production cuts of more than one million barrels a day in the face of weaker demand. Oil prices continued to make gains on Tuesday morning.
Brent oil was trading at USD85.38 a barrel early Tuesday, higher than USD84.52 late Monday.
US President Joe Biden on Monday shrugged off the output cut, while the White House criticized the move but said it would be of limited impact on the US economy.
"It's not going to be as bad as you think," Biden told reporters while travelling in Minnesota to promote his economic record.
White House National Security Council spokesman John Kirby told reporters "we don't think that production cuts are advisable at this moment, given market uncertainty." The US "made that clear", he said, but added: "We're focused on moving ahead here."
Sterling was quoted at USD1.2402 early Tuesday, higher than USD1.2386 at the London equities close on Monday.
The euro traded at USD1.0891 early Tuesday, higher than USD1.0883 late Monday. Against the yen, the dollar was quoted at JPY132.89, up versus JPY132.32.
Gold was quoted at USD1,980.12 an ounce early Tuesday, lower than USD1,988.83 on Monday.
In Tuesday's UK corporate calendar, there are full-year results from insurance firm Saga and a trading statement from waste-to-product company Renewi.
In the economic calendar, the EU's producer price index will be released at 1000 GMT.
By Sophie Rose, Alliance News reporter
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