The Australian dollar dipped

The Federal Reserve is widely expected to raise interest rates for the second time this year on Wednesday. 

The dollar hit a two-week high of 110.27 yen in late U.S. trade on Wednesday before giving up gains in Asia, likely related to the selling in Aussie/yen, to trade at 110.01 yen, down 0.15 percent on the day.

The Australian dollar dipped 0.15 percent against the dollar to $0.7655, off a 1-1/2-month high of 76.77 cents touched on Wednesday, underpinned in part by the country’s strong economic growth data published on Wednesday.

The improving market mood on the back of easing worries about Italian politics and the strength of high-tech shares has supported high-beta currencies such as the Australian dollar and has weighed on a low-yielding yen for the past week.

But many investors are cautions on making big bets due to uncertainties over trade frictions, given U.S. President Donald Trump looks set to clash with other Group of Seven leaders at their weekend summit in Canada.

8@eight: Stocks to open flat after Fed sparks late Wall Street selloff

The Australian sharemarket is set to open flat, with S&P/ASX 200 futures giving up most of their gains as the US sharemarket turned negative in the final hour of trading.

Wall Street assessed the Federal Reserve's signal that it's in no rush to raise rates even as inflation rises to its target, sparking inflation concerns. The US central bank left interest rates unchanged, but kept the door open for a rate rise in June.

Aussie Dollar: The Australian dollar has followed Wall Street lower after the US Federal Reserve indicated that it is on track to raise its interest rate at its next policy meeting in June.

At 6:35 am AEST on Thursday, the local currency was worth 74.86 US cents, down from 75.11 US cents on Wednesday. Currency traders are now looking to upcoming economic data such as March trade figures and service sector PMIs for April. 

Australian shares: The S&P/ASX 200 rose 0.6 per cent to 6,050 on Wednesday, powered by Qantas Airways. The nation's biggest airline joined the global earnings party after forecasting record annual profit and excited investors with the order of six new 787 Dreamliners.

Twenty stocks hit 52-week highs during Wednesday's session, with only two hitting 52-week lows.

In economics news on Thursday, the Australian Bureau of Statistics releases building approvals figures for March, and international trade data, also for March. 

On the companies side, National Australia Bank releases its half year results, and QBE Insurance and Santos hold their annual general meetings.

ASX set to return with strong open

The ASX is set to open in positive territory as it returns after the Anzac Day public holiday, following Wall Street higher. 

ASX: After a day off for the Anzac Day holiday, the local sharemarket is set to return with a bang with futures pointing to strong open. At 7:40 AEST, futures have the ASX up 41 points, or 0.7 per cent, at the open. 

The Australian Dollar failed to get relief from the selling on Wednesday thanks to the fast money crowd chasing the US Dollar higher recently. AUD/USD is pushing closer for a test of the December 8 low of 75.02 US cents per AUD.

Currently, the fundamental background forces look favourable. Since February, a key correlation has been the spread between the AU/US 2-year sovereign yield spread that turned negative earlier this year with the US now offering a premium to Aussie benchmark rates.

Currently, the yield spread is -0.384 percent which poses a risk should the correlation hold. Traders who look at technical studies will note that AUD/USD is closing in on the -1 standard deviation level of the 12-month average of 77.48 at 75.68 US cents per AUD.

The Australian dollar has recovered

The Australian dollar has recovered from its drop earlier in the day, currently sitting at US77.92¢.

The Australian Bureau of Statistic's latest labour force data was well below forecasts and sent the dollar down as low as US77.75¢.

It quickly recovered however, rising to just below US78¢ before settling. 

The dollar is currently trading up 0.1 per cent.

The Australian dollar was slightly lower, Bank of Queensland is down

The Australian dollar is unruffled by the release of the minutes of the latest Reserve Bank of Australia meeting this morning, with the Aussie dollar recently trading at US77.69¢ against the greenback, down 0.1 per cent.

In the minutes out today the RBA mentions the currency and notes that there have been "fairly modest movements in most major exchange rates over the previous month."

The Australian dollar was slightly lower over the month as commodity prices dipped and interest rates in the United States moved above Australian interest rates, the cental bank notes.

The RBA gave no sign that interest rates would move any time soon. While the next move in interest rates will likely to be up than down, "members also agreed that there was not a strong case for a near-term adjustment in monetary policy," the minutes revealed.

Bank of Queensland is down 2.3 per cent at $10.66 today, with the banking group one of the worst performers in the ASX 200.

The bank posted a slightly higher rise in first half cash profit driven by lower loan losses and lending growth in commercial loans, but the numbers missed market expectations.

The regional bank also said it would sell its St Andrew's Insurance division to Freedom Insurance Group for $65 million.

ASX battles after tumultuous Wall St trade and starts new quarter on back foot

Australian shares managed to claw back the bulk of early losses on Tuesday to end marginally lower, thanks largely to strong support for the big miners and a takeover offer for gas company Santos.

Monday's news of Chinese retaliation to US trade tariffs rattled global markets, while further sharp losses in big tech names such as Facebook and Intel that night extended recent falls in key Wall Street indices to more than 10 per cent, satisfying the technical definition of a correction.

After sliding sharply in early trade, the benchmark S&P/ASX 200 index battled back through the morning to climb back into the black by lunchtime before ultimately ending the day off 7 points at 5752. The wider All Ordinaries index eased 10 points to 5859 as futures trading pointed to some recovery in New York on Tuesday night.

The major diversified miners provided the bulk of the support for the ASX, as BHP climbed 1.8 per cent to $28.71 and Rio Tinto 2.1 per cent to $74.19. Gold miners were also in favour as the nervous tone in markets pushed the price of the precious metal higher. Newcrest Mining ended the session up 2.3 per cent to $20.01 as the All Ordinaries Gold Index climbed 2 per cent.

Santos's 16 per cent surge to $5.89 provided a further impetus for the local bourses recovery as it returned to trade late Tuesday morning after confirming a $6.50 bid from US consortium Harbour Energy.

Among the major drags on the ASX on Tuesday were further losses in the major banks – including a 1.2 per cent fall in ANZ to $26.55 – while pokies group Aristocrat Leisure dropped 2.7 per cent to $23.41.

Toll road operator Transurban lost 1.7 per cent to $11.23 and Sydney Airport fell 2.1 per cent to $6.57.In other news, the Aussie dollar found some support following the Reserve Bank's widely anticipated decision to hold rates steady at 1.5 per cent for a record 18 straight meetings. The currency fetched US76.9 cents in late trade.

10 of the cheapest shares on the ASX today

Australian Stock Markets

Buying wonderful companies at fair prices is the mantra of Warren Buffett. But this is not how he has always been. Buying fair companies at wonderful prices is how Buffett started – a skill he learnt from Benjamin Graham.

Buffett refers to this approach as the cigar butt approach. It entails a focus on valuation in isolation of quality and growth.  

Carlisle has also demonstrated that (unless you are Warren Buffett) buying companies solely on valuation is more profitable than buying on a combination of price and quality.

This difference is equal to millions of dollars over several decades. So where are the fair companies available at wonderful prices on the ASX today? 

To find companies currently trading at wonderful prices, we have sorted ASX stocks over $300 million in market capitalisation by their Sonkin Ratio.

The Sonkin Ratio is a robust version of the Price to Earnings ratio. The Sonkin Ratio is simply the Enterprise value of a company divided by its operating earnings adjusted for tax. It can be expressed as: 

Sonkin ratio = (Market capitalisation + Cash – Debt) / EBIT(1 – Tax rate) 

The Sonkin Ratio is the multiple of tax-adjusted operating earnings an investor would pay for the stock. Or, how much an investor would have to pay for every dollar of operating earnings. 
Here are 10 of the cheapest companies on the ASX and their Sonkin Ratios. 

HT&E Ltd (ASX: HT1) – 3.05
Resolute Mining Limited (ASX: RSG) – 5.18
Retail Food Group Limited (ASX: RFG) – 6.80
Fortescue Metals Group Limited (ASX: FMG) – 6.90
Seven West Media Ltd (ASX: SWM) – 7.94
Myer Holdings Ltd (ASX: MYR) – 8.36
Sky Network Television Limited (ASX: SKT) – 10.31
Washington H. Soul Pattinson and Co Ltd (ASX: SOL) – 10.64
St Barbara Ltd (ASX: SBM) – 10.99
BlueScope Steel Limited (ASX: BSL) – 11.24

These are 10 of the cheapest stocks on the ASX over a market capitalisation of $300 million.

Of course, there are many and varied reasons for why they are cheap.

Distinguishing between those that represent bargain prices, and those that are companies in terminal decline is the difficult part. It helps if you are Warren Buffett. 

Australian shares set to open higher

Australian Stock Markets

THE Australian market looks set to open higher after another week of gains on Wall Street with US equities climbing to record highs. 

THE Australian market looks set to open higher after another week of gains on Wall Street with US equities climbing to record highs. At 0700 AEDT on Monday, the share price futures index was up 16 points, or 0.27 per cent, at 5,955.

A

In the US, shares of Apple, the world’s most valuable publicly traded company, rose 2.6 per cent as shoppers bought its latest iPhone and gave a better-than- expected sales forecast for the US holiday shopping season.

Meanwhile, US job growth accelerated in October after hurricane-related disruptions in the prior month, the Labour Department said.

The Dow Jones Industrial Average rose 0.1 per cent, the S&P 500 gained 0.31 per cent and the Nasdaq Composite added 0.74 per cent.

Locally, in economic news on Monday, the ANZ job advertisements series for October is due to be released, as is the CoreLogic survey of capital city house prices for the week just ended.

In equities news, Westpac and Orica are both slated to release full-year results.

The Australian market on Friday closed at its highest level since April, 2015, with broad gains led by mining, energy and industrial stocks. The benchmark S&P/ASX200 index rose 28.2 points, or 0.48 per cent, to 5,959.9 points The broader All Ordinaries index was up 28.1 points, or 0.47 per cent, to 6,030.3 points.

Meanwhile, the Australian dollar has continued its slide against a strengthened greenback following Friday’s disappointing local retail figures. The local currency was trading at 76.59 US cents at 0700 AEDT on Monday, from 76.86 on Friday.

Australian market set to open flat

Australian Stock Markets

THE Australian market looks set to open flat after Wall Street pulled back record-high territory and most other international markets fell.

THE Australian market looks set to open flat after Wall Street pulled back record-high territory and most other international markets fell. 

At 0700 AEDT on Tuesday, the share price futures index was flat, at 5,900. In the US, equity market sentiment was hurt by a Bloomberg report that said the House of Representatives was discussing a gradual phase-in for a corporate tax cut that Trump and his fellow Republicans favour.

Markets also were concerned about the impact to Trump’s agenda from news that his former campaign manager, Paul Manafort, had been charged with money laundering following the investigation into Russian meddling in the 2016 presidential election.

The Dow Jones Industrial Average closed down 0.36 per cent, the S&P 500 lost 0.30 per cent and the Nasdaq Composite dropped 0.03 per cent. Locally, in economic news, the ANZ-Roy Morgan Consumer Confidence weekly survey is due out.

In equities news, Westpac Bank representatives are expected to make opening remarks in the trial on ASIC allegations of rate rigging.

The Federal Court hearing to gain court approval for the transfer of Ten’s shares to US media giant CBS is slated for Tuesday.

Meanwhile, Woolworths is expected to release quarter sales figures and Origin Energy is slated to release its quarterly production report. Bendigo and Adelaide Bank and iSelect, Inghams Group have annual general meetings scheduled.

Meanwhile, the final stage in the takeover of Ten Network by CBS is slated to start with a court hearing for the transfer of the troubled-free-to-air broadcaster’s shares to the US media giant.
The Australian market on Monday closed higher with broadbased gains led by energy companies, banks and industrial stocks.

The benchmark S&P/ASX200 index rose 15.9 points, or 0.27 per cent, to 5,919.1. The broader All Ordinaries index lifted 14.4 points, or 0.24 per cent, to 5,983.7 points.

Meanwhile, the Australian dollar is higher with the greenback easing after the report on US tax cut and the news of money laundering charges against Mr Manafort. The local currency was trading at 76.91 US cents at 0700 AEDT on Tuesday, from 76.74 on Monday.

Dollar lower or steady at best over the coming year: Reuters poll

Most major currencies will hold on to their gains made in 2017 against the dollar over the coming year, according to a Reuters poll of currency strategists who were not entirely convinced of the U.S. administration’s ability to pass through tax cuts.

A raft of robust data out of the United States and new general plans on tax reform from the White House sent the dollar .DXY to a seven-week high on Tuesday and up almost 3 percent last month. 

But the latest poll of over 60 strategists taken this week showed the greenback will at best be where it is now in three, six, and 12 months as predictions were largely unchanged, suggesting the current rally will mostly be short-lived. 

That was also partially reflected in predictions for dollar positioning at the end of October. Speculators’ net short bets on the dollar are at their highest since late September 2012, according to the Commodity Futures Trading Commission data. 

A touch more than half of 38 respondents who answered an extra question said those bets will decrease by the end of the month, while 10 said they will remain the same. 

While only two strategists said bets against the dollar will increase, just six of them said there will be a reversal in positioning in favor of the greenback. 

Expectations have been weighed lower for the dollar on the lack of belief the U.S administration will be able push through any form of tax reforms. 

Indeed a simple majority of strategists, 24 of 43, who answered an extra question said they do not expect tax cuts will make it through Congress this year. The remaining 19 respondents said they will. 

Strategists’ hesitation in calling for a stronger dollar has also been driven by muted expectations now of higher interest rates in the United States and already mostly priced-in, than the shift in central bank policy in other developed markets.

Dollar gains as Europe struggles with Spain pains

World stocks fell for the first time in eight days on Friday, as jitters about Catalonia’s push to separate from Spain returned to Europe and bets on higher U.S. interest rates sent the dollar to its highest since mid August.

Traders were preparing for their monthly installment of U.S jobs data but there was too much movement in Europe to allow the normal pre-payrolls lull in market activity. 

Spanish stocks .IBEX and bond prices, which had rallied on Thursday, were sent tumbling back again as a Catalonian official said the region's parliament would meet on Monday in defiance of a ruling by Spain's constitutional court. 

It sent the euro scuttling back below $1.17 EUR= again and gave the dollar .DXY another leg up as it headed for a fourth consecutive week of gains a move that is also starting to apply pressure to currency-sensitive emerging markets.

Economists polled by Reuters expect the figures to show 90,000 new U.S. jobs were created in September, down from 156,000 in August. It will also show how hurricanes Harvey and Irma affected the labour market. 

U.S. data this week has been solid on the whole. It has been one of the reasons for the dollar’s strength by also feeding bets that the Federal Reserve will raise U.S. interest rates for a third time this year in December. 

Interest rate futures traders are now pricing in an 86 percent likelihood of a December rate hike, up from 78 percent a week ago, according to the CME Group’s FedWatch Tool. 

Aberdeen Standard Investments Senior Investment Manager James Athey said the question now was what happens next year. Not only is inflation still subdued but the Fed could well get a new head.

It has been a far less impressive week for Britain’s sterling amid growing worries over Theresa May’s future as British prime minister, as well as over the health of the economy. 

The currency slipped to its lowest against the dollar in a month on Friday and was headed for its worst week against the U.S. currency in a year as it slipped another half a cent to $1.3060.

The Australian dollar was down 0.5 percent too at $0.7753 after falling to as low as $0.7743 AUD=D4, its weakest since mid-July. The Aussie slid following media reports that Reserve Bank of Australia board member Ian Harper had said he is not ruling out an interest rate cut. 

In commodities meanwhile, Brent crude LCOc1 was down 0.1 percent at $56.94 a barrel.
The futures contract had surged 2.1 percent overnight on signs Saudi Arabia and Russia would limit production through next year, although caution towards a tropical storm heading for the Gulf of Mexico cut short the advance.

Global stock market party settles down for central bank reflection

Global stocks came off record highs and the euro held near a seven-week low on Thursday as investors prepared to parse minutes from the European Central Bank’s last meeting for clues to its exit from ultra-easy monetary policy.

Political tensions emanating from Spain, where one of its richest regions Catalonia has pledged to declare ‘independence in days’, was also at the forefront of concerns for European markets. 

Spain's government bond yields rose to their highest level since March while Madrid's stock market .IBEX headed for its biggest weekly loss of the year. 

Euro zone stocks .STOXXE steadied from a wobble on Wednesday, but with public holidays across Asia and some key data due from the world’s largest economy the U.S. coming up later this week, an index of global stocks flat lined .MIWD00000PUS. 

A Reuters poll showed global stocks will rise even more over the coming year as optimism about the global economy grows, but a slim majority of equity strategists polled by Reuters also said the current eight-year bull run will end in 2018. 

There were some eye-catching moves in currency markets as economic concerns at one stage knocked half a percent off the Australian dollar AUD= and the South African ZAR= rand, and investors mulled whether they had become too bullish on the European single currency EUR=.

“Much attention will be directed toward the minutes of September’s European Central Bank meeting, which could offer some fresh insight into the central banks tapering plans. The euro still remains at risk of depreciating further, if the minutes express concerns over the strength of the euro,” said Lukman Otunuga, Research Analyst at FXTM. 

The euro was broadly flat on Thursday at $1.177 EUR=, not straying too far from a seven-week low of $1.169 hit earlier this week. 

There is also plenty of uncertainty over the future path of monetary policy in the United States, with U.S. President Donald Trump promising to decide this month on a new chief to replace Janet Yellen, whose term expires in May.

Global shares score latest record high, dollar flexes muscle

World shares hit their latest in a run of record highs on Tuesday, while the dollar was at it loftiest in 1-1/2 months as encouraging U.S. data lifted it in tandem with global bond yields. 

MSCI’s 47-country ‘All-World’ index which contains more than 2,400 firms was pushed to the fresh peak as Europe’s main bourses added to gains made in Asia and after Wall Street set its own record close again overnight. 

It was the tenth new high since late July alone and extends the year’s blizzard of records that started in February to more than 40 with no sign it is about to run out of steam yet. 

SEB investment management’s global head of asset allocation Hans Peterson pointed to strong economic and trade data and signs that firms in large economies like the United States and Europe were finally increasing investment spending. 

The dollar climbed 0.2 percent to 93.74 .DXY against a broad basket of other top world currencies. [/FRX] 

That was its highest level since Aug. 17 and came as a firming view that the Federal Reserve will raise U.S. interest rate for a third time this year in December kept two-year U.S. government bond yields US2YT=RR hovering at a 9-year high. 

Borrowing costs across the euro zone nudged higher too. Southern European bonds continued to underperform meanwhile as political tensions remained in Spain after Sunday’s independence vote in Catalonia was marred by police violence. 

The uncertainty also kept the squeeze on the euro. It dipped 0.2 percent to $1.1709 EUR= while the dollar added 0.3 percent against the yen to 113.11 yen JPY= to keep it within reach of last week's two-month high of 113.26 yen. 

Crude oil futures extended losses after tumbling on Monday, as a rise in U.S. drilling and higher OPEC output put the brakes on their recent rally and rekindled concerns about oversupply. 

Brent crude LCOc1 slipped 0.4 percent to $55.90 a barrel, after marking a third-quarter gain of about 20 percent. U.S. crude CLc1 fell 0.3 percent to $50.42.

Spot gold XAU= edged down 0.1 percent to $1,270.06 per ounce, plumbing its lowest since Aug. 15 as the dollar continued to strengthen.

World shares, dollar rise after week of North Korea-driven losses

World stocks rose on Monday, attempting to recover after fears of a U.S.-North Korea nuclear standoff drove them to the biggest weekly losses of 2017, while the dollar too rose off four-month lows it had hit against the yen. 

European shares bounced after falling nearly 3 percent last week, with the pan-European STOXX 600 up 0.7 percent following on from a 0.9 percent jump in MSCI's index of Asia-Pacific shares outside Japan .MIAPJ0000PUS. 

Those gains were led by bounces in Australia, Hong Kong and South Korea .HSI .KS11 while MSCI's world index rose 0.2 percent .MIWD00000PUS. 

U.S. stock futures ESc1 rose 0.6 percent, suggesting a higher open later in the day.

That prompted North Korea to say it was considering plans to fire missiles at the U.S.-held Pacific island of Guam. 

Tokyo shares failed to partake in the region's gains however, slipping 1 percent to three-month lows .N225 even after data showing robust 1.1 percent second quarter growth in Japan, the sixth straight quarter of expansion. 

That was due to worries over the potential impact of the yen's recent surge against the dollar . .N225. The Japanese currency, which firmed around 1.4 percent last week, tends to benefit during times of geopolitical or financial stress as Japan is the world's biggest creditor nation. Japanese investors also repatriated cash held overseas. 

The greenback rose 0.5 percent to 109.70 yen JPY= after slipping to 108.720 on Friday, its weakest since April 20. Against a basket of currencies it firmed 0.2 percent, rising off last week's 10-day lows .DXY. 

U.S. 10-year yields US10YT=RR inched higher after falling on Friday to six-week lows following data showing that U.S. consumer prices rose just 0.1 percent last month, below economists' forecast of a 0.2 percent gain. 

Euro zone bond yields also rose, with investors interpreting the robust Japanese data as a sign that the global economy is indeed on the mend.

The yield on Germany's 10-year government bond DE10YT=TWEB, the benchmark for the euro zone, was up 4.5 bps to 0.43 percent, a move mirrored by most other euro zone debt. 

Earlier, Chinese markets were largely unfazed by a slew of activity data from China which was softer than forecast, though still largely solid. 

However, the weak Chinese data hit oil prices, with Brent crude futures LCOc1 down 35 cents lower at $51.74 a barrel. 

The dollar Slipped, Oil Prices Rose Two-Month High

In the currency market, the euro EUR= traded at $1.1832, having risen to as high as $1.1846, its best level since January 2015, with a test of $1.20 within sight.

It has gained almost 15 percent from its January 3 low of $1.0340, which was its weakest level since January 2003, on rising expectations that the European Central Bank will taper its stimulus next year. 

The dollar also slipped to a 1-1/2-month low of 110.005 yen JPY=, and last stood at 110.18 yen, down 0.1 percent. 

The dollar's index against a basket of six major currencies was at 92.878 .DXY, not far from a 13-month low of 92.784 plumbed overnight. The index had marked its fifth straight monthly decline in July, the longest consecutive retreat since its losing run marked from the end of 2010 through early 2011. 

The Australian dollar gained 0.4 percent to $0.8034 AUD=D4, helped by the strong Chinese data, ahead of the Reserve Bank of Australia's policy announcement later in the day. The RBA is widely expected to keep interest rates on hold. 

The Chinese yuan hit 10-month highs in both onshore CNY=CFXS and offshore CNH=D4 trade.

U.S. political turmoil also weighed on the dollar after U.S. President Donald Trump dismissed his communications director, Anthony Scaramucci, just over a week after naming him to the job.

Oil prices rose to two-month highs on Monday, on expectations of U.S. sanctions against Venezuela's oil sector after Sunday's election of a constitutional super-body in Caracas, which Washington denounced as a "sham" vote. 

Oil prices maintained gains even after the U.S. Treasury Department late on Monday announced sanctions limited only to Venezuelan President Nicolas Maduro. 

Brent crude futures LCOc1 traded at $52.81 per barrel after having hit a high of $52.92 on Monday.

Copper CMCU3 rose 0.2 percent to $6,380 per tonne, holding near Monday's two-year high of $6,430 and its 2015 peak of $6,481.

Dollar nurses losses as carry trades flourish

The U.S. dollar nursed losses at a 10-month low against a basket of currencies on Monday as investors cheered upbeat Chinese data by piling into leveraged positions such as the Australian dollar and other high-yielding currencies. 

Some of the biggest gains were seen in the yen crosses such as sterling, which was up 0.1 percent on the day as investors added bets that U.S. interest rates would rise very gradually in the coming months after the latest data.

"Risk outlook remains positive after the latest figures and markets are looking to add positions especially in the high-yielding names," said David Madden, a strategist at CMC Markets. 

China's second-quarter gross domestic product topped forecasts with a rise of 6.9 percent on the year, while retail sale and industrial output were both strong. 

The Aussie shot to a two-year high and breached major chart resistance in the process in the $0.7700/7778 range. The Aussie was last at $0.7814 with bulls targeting the 200-week moving average around $0.8018

U.S. rate hike expectations have been pared to less than a 50-percent probability after the latest inflation print on Friday and with no top-tier data this week, markets have plenty of time to mull over the future direction of interest rates. 

The repeated disappointment on prices cast a question mark over the Federal Reserve's confidence that inflation would soon rebound. 

Latest positioning data suggest markets are also turning bearish on the dollar with the first U.S. dollar shorts evident since May 2016. However, carry trades are flourishing with Japanese yen shorts at its highest level since June 2015. 

The dollar was trading broadly flat at 112.575 against the yen.

Fed's Yellen to speak - stocks up, dollar sluggish

The dollar was stuck near its lowest in more than a year against the euro on Wednesday while stocks edged higher in light trading ahead of Janet Yellen's testimony to Congress. 

While the Federal Reserve chair is expected to say that the Fed remains on a hawkish course of steadily rising rates, any signals on how the bank is viewing a retreat in inflation and muted wage growth will be closely watched. 

Comments overnight from two of her colleagues calling for caution on further interest rate rises have pushed back the probability of a hike again before the end of the year to 50 percent, according to the CME's Fed watch data.

Sterling hit a two-week low against the dollar and deepened a fall to its lowest in 8 months against the euro on Wednesday after Bank of England Deputy Governor Ben Broadbent said he was not yet ready to raise interest rates. 

The fall in sterling once again lifted the exporter heavy UK bluechip index .FTSE which rose 0.7 percent, outperforming regional peers. 

U.S. stocks took a brief tumble during Tuesday trading on Wall Street after emails disclosed President Donald Trump's eldest son welcomed help from a Russian lawyer for his father's 2016 election campaign against Hillary Clinton.

The dollar, however, failed to recover after the damage suffered from the new twist in the Trump campaign's alleged links with Russia. But by the closing bell, Wall Street shares had clawed back their losses.

The greenback was trading flat against a basket of major currencies .DXY and was hovering near its lowest since last May against the euro EUR=. 

In commodity markets, oil prices got a reprieve from worries about oversupply after the U.S. government cut its crude production outlook for next year and as fuel inventories plunged.

Brent crude futures LCOc1 rose 1.3 percent while U.S. West Texas Intermediate (WTI) crude futures CLc1 were up 2 percent.

Global Stock Market News

Australian shares bucked the trend to surge 1.6 percent, bouncing solidly from a 2.3 percent loss over the previous two sessions, helped by the nation's central bank steering a neutral course on rates in contrast to some of its peers who have recently turned more hawkish.

The broad Asian share market performance was in stark contrast to the overnight increases in European and U.S. shares, with oil's longest stretch of daily price gains in over five years boosting energy shares.

The S&P 500 index .SPX and the Dow Jones Industrial Average .DJI posted gains of 0.2 percent and 0.6 percent, respectively, led by financials and energy shares. The Nasdaq .IXIC lost 0.5 percent, as the rotation away from technology names continued.

European markets posted even stronger gains, with the FTSEurofirst 300 jumping as much as 1.2 percent following losses last week.

In currency markets, the dollar index .DXY, which tracks the greenback against a basket of trade-weighted peers, was steady at 96.23.

The Australian dollar AUD=D4 slid 0.65 percent to $0.7609 after the Reserve Bank of Australia's neutral outlook on rates disappointed speculators betting it would join other global central banks that have recently turned hawkish.

The euro EUR=EBS was little changed at $1.136 on Tuesday. Sterling inched up 0.1 percent to $1.295 GBP=D3, but failed to make up most of Monday's 0.7 percent loss after poorer-than-expected data from Britain's manufacturing sector.

Crude futures posted their first session of losses in nine, ending their longest run of gains since February 2012, as traders closed positions ahead of the U.S. holiday. U.S. crude CLc1 slipped 0.5 percent to $46.85 a barrel.

Global benchmark Brent LCOc1 also fell 0.5 percent to $49.44. On Monday, it closed up 3.7 percent, its biggest one-day gain since December 2016.

Gold inched up from its lowest level in more than seven weeks hit on Monday on the dollar's strength. Spot gold XAU= was up 0.3 percent at $1,224.49 an ounce on Tuesda

Glencore says will respond in due course after Rio favors Yancoal bid

Glencore (GLEN.L) on Tuesday said it would review its options after Rio Tinto (RIO.L)(RIO.AX) said it was sticking to a recommendation of China-backed Yancoal (YAL.AX) as the preferred buyer of its Coal & Allied division in Australia.

In a statement, Glencore, which had made a higher offer than Yancoal, said it would respond "in due course".

Dollar gains as Fed sticks to guns on policy tightening

The dollar inched higher on Thursday, with expectations of another Federal Reserve rate hike this year kept alive by a policy meeting that also pointed the way to a trimming of the huge emergency funds pumped into the economy since 2009. 

As widely expected, the Fed raised interest rates a quarter percentage point to a target range of 1.0-1.25 percent on Wednesday but it also gave its first clear outline on its plan to reduce its $4.2-trillion bond portfolio.

That undid all of the damage done to the greenback earlier in the day and pushed it higher as European traders got down to business on Thursday.

By 0806 GMT, the index which measures the dollar's broader strength was up 0.2 percent at 97.145 .DXY.

A Reuters poll of 21 of the 23 primary dealers that do business directly with the Fed showed 14 of them now believed it would announce the start of its balance sheet normalization at its Sept. 19-20 policy meeting. The rest of them said it would make such a move at its Dec. 12-13 meeting.

Deepening political turmoil in Washington did not seem to weigh on the greenback after the Washington Post reported that U.S. President Donald Trump is being investigated by special counsel Robert Mueller for possible obstruction of justice.

Against its Japanese counterpart, the dollar rose 0.1 percent to 109.57 yen JPY=EBS, above Wednesday's eight-week low of 108.81 yen.

On Friday, the Bank of Japan is widely expected to keep its monetary policy unchanged, and reassure markets it will lag the Fed in tapering its massive stimulus program, as Japan's inflation remains low despite a strengthening economy.

The euro EUR= was 0.3 percent lower at $1.1191, down a full cent from a seven-month peak of $1.1296 scaled overnight.

The Australian dollar AUD=D4 rose 0.2 percent to $0.7599, moving back toward its 2-1/2-month high of $0.7636 hit on Wednesday, after a better-than-forecast employment report.

But the New Zealand dollar skidded 0.7 percent to $0.7222 NZD=D4, moving away from the previous session's four-month high of $0.7319.