Australian shares are set to open lower, after European stocks dropped in the absence of U.S. trading.

ASX futures were down 0.3% or 21 points as of 8:30am on Tuesday, suggesting a lower open.

U.S. equity and bond markets were closed for Martin Luther King Day.

In commodity markets, Brent crude oil fell 0.2% to US$78.13 a barrel while gold was up 0.4% to US$2,056.55.

In local bond markets, the yield on Australian 2 Year government bonds was down at 3.78% while the 10 Year yield was flat at 4.07%. US Treasury notes were unchanged, with the 2 Year yield at 4.14% and the 10 Year yield at 3.94%.

The Australian dollar hit 66.56 US cents down from the previous close of 66.84. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was up at 97.15.


Chinese shares closed mixed as investors digested the PBOC's latest move. China's central bank kept key policy rates unchanged, which may reflect the country's concerns about bank profitability, ANZ Research analysts say in a note. The benchmark Shanghai Composite Index rose 0.15% to 2886.29, while the Shenzhen Composite Index ended 0.3% lower at 1743.58. The ChiNext Price Index fell 0.9%. The beverage sector led losses, with Kweichow Moutai shedding 0.2% and Shanxi Xinghuacun Fen Wine Factory losing 3.6%. Auto-parts companies also fell. Huizhou Desay SV Automotive and Ningbo Tuopu Group were down 3.7% and 1.6%, respectively. Among the top gainers, China Merchants Energy Shipping advanced 3.4% and Cosco Shipping Holdings gained 3.3%.

Hong Kong shares ended lower, dragged by the tech sector. Baidu plunged 11.5% despite denying any affiliation or partnership with a Chinese academic institution after a news report linking the company's Ernie to the military-affiliated university's AI test. The Hang Seng Tech Index fell 1.9% to 3404.00. and shed 1.8% and 1.7%, respectively. Among automakers, Li Auto lost 4.3% and BYD was 2.0% lower. Top gainers included CK Infrastructure Holdings, which rose 3.6%, and Wuxi Biologics, which added 3.4%. China Unicom gained 3.3%. The benchmark Hang Seng Index closed 0.2% lower at 16216.33.

Japan's Nikkei Stock Average rose 0.9% to close at 35901.79, its highest level since February 1990, led by shipping and securities-related stocks. Among shipping companies, Kawasaki Kisen Kaisha jumped 9.6% and Mitsui O.S.K. Lines rose 4.6% amid expectations that freight rates could increase due to an escalation of the Middle East conflict, which may affect international shipping in the Red Sea. Other top advancers included Daiwa Securities Group, which added 5.9%, and Nomura Holdings, which was up 4.95%. USD/JPY was at 145.27, compared with 145.12 around Friday's Tokyo stock-market close. The 10-year JGB yield was down 3 bps at 0.555%.

Indian shares rose for a fifth straight session, continuing to notch record highs. The benchmark Sensex Index climbed 1.05% at 73327.94, passing the 73000 level for the first time. Indian equity benchmarks have hit new highs amid a stable inflation outlook and better-than-expected results from IT heavyweights that have set the tone for earnings season, ICICIdirect said in a note. Tech stocks led the gains. Wipro added 6.25% after its better-than-anticipated fiscal 3Q results. HCL Technologies climbed 2.9% and Infosys gained 2.5%. Banks were broadly higher, with HDFC Bank up 2.0% and Kotak Mahindra Bank rising 0.95%. Bajaj Finance was the biggest laggard, losing 2.3%.


European stocks dropped as the absence of U.S. trading due to a public holiday stifled market momentum. The Stoxx Europe 600 and DAX fell 0.5%, while the FTSE 100 backtracked 0.4% and the CAC 40 retreated 0.7%. Burberry, HSBC and Lloyds Banking Group were lower after reported broker downgrades, CMC Markets says, while Deutsche Bank fell 0.9% after sector M&A chatter. "One story doing the rounds earlier Monday was talk that Deutsche Bank was looking at a possible takeover of either Commerzbank, or Dutch bank ABN Amro," CMC analyst Michael Hewson wrote. "This sounds like a slow news-day story, given the significant regulatory hurdles any deal would have to overcome."

The FTSE 100 index closed Monday down 0.4% at 7594 points, in line with European peers and mainly dragged by financial stocks and retailers in a volume-light day as U.S. markets were closed for Martin Luther King Day. "It seems that profit-taking continues to prevail among investors. Earnings season didn't get off to a great start on Friday, so there has been little incentive for traders to chase the market even in its current subdued state," IG chief market analyst Chris Beauchamp says in a note. Luxury goods retailer Burberry was the index worst performer, with shares further dropping 5.7% following Friday's guidance cut, when they slipped 5.5%, followed by online grocer Ocado, down 5.1% ahead of its trading update on Tuesday morning.

North America

U.S. equity and bond markets were closed for Martin Luther King Day.