Australia

Australian shares are poised to rise bucking a mixed session on Wall Street as investors tread water ahead of a batch of earnings from US tech giants and Wednesday’s US Federal Reserve meeting.

ASX futures were up 24 points or 0.35% at 6709 as of 8.00am on Tuesday, pointing to a pop at the open.

Overseas, the S&P 500 added 0.1% while the Dow Jones Industrial Average gained 0.3%. The tech-heavy Nasdaq Composite Index lost 0.4% as technology favourites Alphabet, Apple and Tesla slumped 0.4%, 0.7% and 1.4%, respectively.

Walmart shares tumbled 10% in aftermarket trading on Monday following its second profit in 10 weeks. The retailing giant warned discounting is required to shift inventories of some consumer discretionary items, including clothing, as shoppers balk at higher prices amid soaring inflation.

The Fed on Wednesday is expected to deliver another 0.75-percentage-point interest-rate increase as it attempts to cool soaring inflation. Markets have come under pressure this year as investors worry that the central bank's aggressive tightening will lead the US economy into recession.

So far investors have largely brushed off disappointing earnings. Shares of S&P 500 companies that missed Wall Street's forecasts have fallen 0.2% on average in the two days before their report through the two days after, according to FactSet. That compares with the five-year average of a 2.4% decline.

Edward Park, chief investment officer at Brooks Macdonald, said recent earnings reports have shown recession concerns on the rise among American companies -- though that hasn't necessarily led to big stock selloffs.

"What markets want at the moment is recessionary fears to cause the Federal Reserve to back off," Mr. Park said. "The idea that lots of companies are talking about recessionary fears...in some ways plays to that narrative, so that's why markets have been shrugging off some of the poorer earnings guidance."

In commodity markets, Iron ore added 2.8% to US$106, Brent crude oil gained 1.6% to US$104.92, while gold edged down 0.1% to US$1735.90.

In local bond markets, the yield on Australian 2 Year government bonds declined to 2.64% while the 10 Year fell to 3.35%. Overseas, the yield on 2 Year US Treasury notes reversed course and increased to 3.02% and the yield on the 10 Year US Treasury notes rose to 2.80%.

The Australian dollar rose to 68.56 US cents at 7am AEST up from 69.26 at the previous close. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies slipped to 98.51.

Asia

Chinese shares finished lower, dragged by auto makers and renewables. Economic slowdowns in the US and EU could hurt Chinese sectors including auto, electronics and electrical equipment, whose exports contribute to a relatively larger portion of companies' revenue, Soochow Securities analysts say in a note. Great Wall Motor slid 3.7% and BYD Co. lost 2.0%, while Longi Green Energy weakened 2.2% and Tongwei Co. gave up 4.1%. Property developers were among the gainers. Poly Developments added 3.0% and Gemdale rose 3.5%. The Shanghai Composite Index fell 0.6% to 3250.39, the Shenzhen Composite Index declined 0.9% and the ChiNext Price Index lost 1.2%.

Hong Kong's Hang Seng Index falls 0.4% to 20531.78 in morning trade amid persistent headwinds. Investor sentiment is likely to remain weak as US and Europe continue to hike rates and as Chinese homebuyers refuse to repay mortgages for unfinished property projects, KGI Research analysts say in a note. Decliners include Sunny Optical Technology, down 2.3%, and Alibaba Group Holding, which falls 2.2%, and Sino Biopharmaceutical, which is off by 2.1%. Gainers include Henderson Land Development, which adds 0.7%.

Japanese stocks ended lower, dragged by falls in electronics stocks as concerns grow about the outlook of the global economy and corporate earnings. Fanuc dropped 3.1% and Sony Group lost 2.7%. The Nikkei Stock Average fell 0.8% to 27699.25. The 10-year Japanese government bond yield falls 1.5 basis points to 0.200%. Earnings are in focus as Sony, Nissan Motor, Takeda Pharmaceutical are set to announce their results later this week.

Europe

European stocks closed mostly higher, although Germany's DAX fell on weak data and gas supply worries. The DAX slips 0.3%, the pan-European Stoxx Europe 600 gained 0.1%, London’s FTSE 100 rose 0.4% and the French CAC 40 climbed 0.3%. Ifo's German business confidence index slumped in July while Russia's Gazprom said it was halting another turbine in the Nord Stream 1 pipeline to Germany, reducing gas flows.

"Gazprom and turbine problems aside, today's more resilient tone appears to suggest that the prospect of further economic weakness might act as a catalyst that could prompt central banks to pare back some of their more hawkish rhetoric when it comes to raising rates," CMC Markets analyst Michael Hewson writes.

North America

US stocks swung between small gains and losses at the start of a crucial week for global markets, with investors awaiting the Federal Reserve's latest policy decision and a slew of corporate earnings reports.

The S&P 500 added 0.1% while the Dow Jones Industrial Average gained 0.3%. The tech-heavy Nasdaq Composite Index lost 0.4% as technology favourites Alphabet, Apple and Tesla slumped 0.4%, 0.7% and 1.4%, respectively.

The Fed on Wednesday is expected to deliver another 0.75-percentage-point interest-rate increase as it attempts to cool soaring inflation. Markets have come under pressure this year as investors worry that the central bank's aggressive tightening will lead the US economy into recession.

Edward Park, chief investment officer at Brooks Macdonald, said recent earnings reports have shown recession concerns on the rise among American companies -- though that hasn't necessarily led to big stock selloffs.

So far investors have largely brushed off disappointing earnings. Shares of S&P 500 companies that missed Wall Street's forecasts have fallen 0.2% on average in the two days before their report through the two days after, according to FactSet. That compares with the five-year average of a 2.4% decline.

"What markets want at the moment is recessionary fears to cause the Federal Reserve to back off," Mr. Park said. "The idea that lots of companies are talking about recessionary fears...in some ways plays to that narrative, so that's why markets have been shrugging off some of the poorer earnings guidance."

Investors are betting the Fed will begin cutting interest rates next year as the economy slows.

Recession fears are being reflected in the inversion of the US yield curve, which happens when shorter-dated yields such as for the two-year Treasury note are higher than for longer-dated debt such as the 10-year. That is seen by investors as a key recession predictor.

Some investors have been wading into the stock market despite these recession fears, helping send the S&P 500 toward its best monthly gain since October.

"For us it's been a phenomenal time to buy companies," said Dev Kantesaria, founder of Valley Forge Capital. "It's one of the top three entry points in our 15-year history."

Mr. Kantesaria said he has been adding to positions of companies such as Intuit and Visa.

The two-year Treasury yield rose to 3.035% Monday from 2.989% on Friday, while the 10-year climbed to 2.819% from 2.781%. Yields rise as bond prices fall.

Earnings reports are expected this week from major technology firms including Apple, Google parent Alphabet, Facebook parent Meta Platforms and Amazon.com. The results could determine whether a recent rebound in beaten-down tech shares will continue.

Some investors said they were being cautious about the recent market rebound.

"I would not lean on a rally like the one we've seen so far as a sign that the coast is clear," said Amy Kong, chief investment officer at Barrett Asset Management.

Shares of World Wrestling Entertainment rose 8.4% after Chief Executive and Chairman Vince McMahon on Friday said he would retire. The Wall Street Journal has reported that Mr. McMahon gave multiple payouts to women who alleged sexual misconduct and infidelity. The company also projected stronger-than-expected quarterly results.

Shares of gold miner Newmont fell 13%. The firm lowered its annual gold production outlook, citing operational challenges at one of its mines and an increasingly competitive labour market.