NEW YORK - Tumbling oil prices fuelled a rally on Wall Street, helping investors shake off renewed fears about a credit squeeze and further economic turmoil that hit global markets earlier in the day.
Ailing banking stocks led the rebound, after some encouraging comments from Federal Reserve chairman Ben Bernanke, who indicated the central bank was likely to extend emergency loans to investment firms.
The blue-chip Dow Jones Industrial Average jumped 152.25 points, or 1.36 per cent, to 11,384.21 after a mixed opening.
The Nasdaq tech-dominated composite index rallied 51.10 points, or 2.28 per cent, to 2,294.42 and the Standard & Poor’s 500 index advanced 21.39 points, or 1.71 per cent, to close at 1,273.7.
LONDON - Britain’s top share index closed 1.3 per cent lower, driven down by sharp falls in heavyweight commodity stocks that tracked crude and metal prices lower, while banks continued to struggle.
The FTSE 100 closed at 5,440.5 points, down 72.2 or 1.31 per cent.
FRANKFURT - The DAX index ended at 6,304.41 points, down 91.34 or 1.43 per cent.
PARIS - The CAC-40 index closed at 4,275.61 points, down 66.98 or 1.54 per cent.
TOKYO - The Nikkei stock average slid 2.5 per cent to its lowest close in nearly three months, dragged down by financials such as top lender Mitsubishi UFJ Financial Group amid renewed credit fears.
The Nikkei fell 326.94 points to end at 13,033.10, its lowest close since April 15.
HONG KONG - Hong Kong shares slid 3.2 per cent, with all stocks in the main index in the red, as jittery investors dumped blue chips on fears of more losses at US financials and amid a lack of market-boosting steps from China.
The Hang Seng Index closed down 692.25 points at 21,220.81, a 15-week low.
WELLINGTON - The share market rebounded more than one per cent, despite the release of further gloomy economic data and falling markets in the United States and elsewhere.
The NZSX-50 benchmark index closed up 39.1 points at 3160.6, on turnover totalling $NZ103.6 million ($A81.76 million).
SYDNEY - The Australian share market is expected to open higher today after US equities gained as the oil price fell and the Federal Reserve chairman indicated the central bank was likely to extend emergency loans to investment firms.
Mining and energy stocks may decline after oil and metals prices slipped overnight.
At 0800 AEST on the Sydney Futures exchange, the September share price index futures contract rose 38 points to 4,999.
In economic news, the Australian Bureau of Statistics releases housing finance data for May and Westpac and the Melbourne Institute release their consumer sentiment index for July.
In company news, Insurance Australia Group Ltd will hold an investor briefing.
Yesterday, the Australian stock market fell to its lowest levels since August 2006 after the financial sector dragged the market down.
The benchmark S&P/ASX200 index was down 69.6 points, or 1.39 per cent, at 4932.9, while the broader All Ordinaries lost 69.3 points, or 1.36 per cent, to 5022.4.
It was the S&P/ASX 200’s lowest close since 15 August 2006 when it finished at 4936.
NYMEX
US crude oil futures fell for a second day in a row on Tuesday, ending nearly four per cent lower on pressure from a stronger dollar and forecasts that eased worries about Hurricane Bertha.
The losses added to a three per cent selloff on Monday as the market retreated after surging to a record above $US145 on Thursday before the Independence Day holiday.
The market is waiting for weekly US inventory data due Wednesday. Analysts polled by Reuters expect a 1.8 million barrel drawdown in crude supplies, a 200,000 barrel drop in gasoline stocks and a 1.9 million barrel build in distillates, which include heating oil and diesel fuel.
Oil markets remain concerned about Iran’s dispute with the West over Tehran’s nuclear program.
On the New York Mercantile Exchange, August crude settled $US5.33 lower, or 3.77 per cent, at $US136.04 a barrel.
A NYMEX record high price of $145.85 was hit on Thursday.
In London, August Brent crude ended down $US5.44, or 3.83 per cent, at $US136.43 a barrel.
August RBOB finished down 11.96 cents, or 3.43 per cent, at $US3.3631 per gallon. It struck a record $US3.5927 on Thursday.
MasterCard Advisors, citing poor weather conditions and high pump prices, estimated that last week’s pre-July 4 holiday weekend gasoline demand averaged 9.4 million barrels per day, down 1.2 per cent from the previous week and 3.9 per cent from the same week last year.
August heating oil ended down 14.94 cents, or 3.76 per cent, at $US3.8202 a gallon. It reached a record $US4.1350 on Thursday.
COMEX
Gold ended slightly lower on Tuesday, paring early losses as some new fund buyers were undaunted by additional declines in crude oil prices along with a rebound in the dollar, compelling other players to cover short positions.
Spot gold moved up to $US921.95 per ounce from session lows, but remained lower than $US925.75 in late Monday trade in New York.
Earlier it touched a session low of $US912.50 an ounce.
When the low held during a bout of heavy midday selling, some buyers regained the confidence to jump back into gold and buy the lows.
On the COMEX division of New York Mercantile Exchange, August futures lost $US5.50, or 0.6 per cent, to end at $US923.30 an ounce, well off the session low of $US913.
As the day began, gold prices slid as weaker oil prices dented interest as an inflation hedge and undermined confidence in commodities as a whole.
Among other precious metals, silver declined to $US17.67 an ounce against $US17.82 late in New York.
Spot platinum fell to a new five-week low of $US1,948.50 an ounce, before steadying to trade at $US1,959.00 from $US1,977 late in New York.
The metal is being pressured by fears over falling demand from carmakers as the US economy falters. Platinum is widely used in autocatalysts.
Spot palladium fell to $US442.00 an ounce from $US447.00 an ounce.
LONDON METAL EXCHANGE
Aluminium fell by 5.7 per cent on Tuesday, retreating from the previous session’s record high as large stocks offset worries about power problems in China and softer oil prices dampened sentiment.
Aluminium for three-month delivery on the London Metal Exchange hit an intraday low at $US3,120 per tonne before closing at $US3,145, down by five per cent or $US165. On Monday, it rallied five percent to a record high of $US3,327 per tonne.
Copper hit an intraday low of $US8,150.25 a tonne, down 3.1 per cent, before closing at $US8,200 versus Monday’s $US8,412.
In New York, copper for September delivery ended down 15.25 cents, or nearly four percent, at $US3.6965 a pound on the the New York Mercantile Exchange’s COMEX division, its lowest level on a settlement basis since June 18.
The metal, used in wiring and construction, touched a record high of $US8,940 per tonne in London and crossed the psychological $US4.00 a pound mark in New York last week due to supply disruptions in Peru, the world’s second largest copper producer.
In aluminium, up to 45 per cent of smelting costs are accounted for by electricity and record high oil prices and power shortages have supported prices.
But with oil prices dropping on Tuesday by $US5 to around $US136 per barrel, the metal used in packaging and transport faced increasing selling pressure.
Lead bucked the falling trend, and closed unchanged at $US1,630 per tonne because of mildly bullish stocks data.
Zinc was down at $US1,750, after hitting an intraday low of $US1,760, down 4.3 per cent, from Monday’s close of $US1,840.
Nickel was at $US20,600, down from $US21,000 and tin fell to $US22,450 from $US22,750.
