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Investment market update

Early Trading

UK equities are expected to open slightly higher this morning ahead of a key UK inflation report, with investors looking for more clues for the timing of a Bank of England interest rate hike.

World Markets

Asian stock markets were mostly lower on Tuesday as disappointing data from the US and further drops in prices of oil and other commodities led investors to remain cautious. Electronics giant Toshiba saw its shares edge slightly higher, up 0.4%, despite speculation it was about to report a net loss for both the past year and previous years following an investigation into the company’s accounting practices.

US stocks rose, following last week’s gain in the S&P 500 Index, with homebuilders pacing the advance amid light volume before further clues from the Federal Reserve on the path for interest rates. Homebuilder stocks in the S&P 500 climbed 2.1% as TopBuild Corp. and KB Home gained more than 3.1%.

UK stocks were little changed as a decline in miners offset a gain in Wolseley Plc. BHP Billiton Ltd. and Glencore Plc, with a gauge of miners dropping to their lowest level since March 2009. Wolseley gained 2.2% after Citigroup Inc. upgraded the shares, citing potential for gains in US market share.

Headlines

Asian currencies headed for their longest losing streak in three years as a bombing in Bangkok and the biggest drop in Indonesian exports since 2012 underscored the headwinds facing emerging markets.

The Federal Reserve releases minutes from its July meeting on 19 August. Traders have raised their expectations for a September rate increase, with the probability rising to 46% from 40%, according to futures trading data compiled by Bloomberg.

Economic growth in Germany is set to be ‘solid’ in the second half of the year, the country’s central bank has said. The Bundesbank said growth in the country would be boosted by both external and domestic demand. Last week, Germany, Europe’s largest economy, reported that its economy grew 0.4% in the three months to June.

With a payment of about €3.2 billion due to the European Central Bank on 20 August, Prime Minister Alexis Tsipras is waiting for approval from five euro-area parliaments before he can receive the first tranche from his country’s third bailout package.

China’s economy is growing more slowly than official data suggests and below potential, a Bloomberg survey indicates, helping to explain why policy makers have stepped up stimulus and the move to boost exports with a weaker yuan. The economy expanded 6.3% in the first half, compared to the officially reported 7%, according to the median estimate of economists surveyed last week. For the full year, a 6.6% pace was the median forecast of respondents, who were asked to nominate real growth rates, not what they expect the official data to show.

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