By Lawrence White
LONDON, Aug 16 (Reuters) – European shares edged higher on Tuesday as investors sought safety in defensive sectors, while risk aversion also lifted the dollar after weak economic data from China and the United States stoked fears. to a global recession.
* The dollar briefly hit a one-week high as investors reinvested in it after abandoning the greenback last week following weaker-than-expected inflation data in the United States, while the Australian dollar, the euro and the Chinese yuan weakened.
* Europe’s benchmark STOXX rose 0.3% to a 10-week high and headed for its fifth straight session of gains, led by mining companies, as London-listed BHP Group posted strong results .
* However, S&P 500 futures and Nasdaq futures were lower, indicating a likely weaker trend for US markets when they open later.
* The MSCI broader index of Asia-Pacific shares outside of Japan fell 0.03% after earlier gains in the day. The MSCI benchmark has gained 5% from the year’s low, but is still down 15% this year.
* Just as investors were buoyed by a four-week rally in global stock markets, which has pushed shares to their highest in more than three months, weak Chinese activity data, covering industrial production and sales retailers, affected confidence.
* In addition, US single-family homebuilder confidence and New York state factory activity fell in August to their lowest level since nearly the start of the COVID-19 pandemic, a further sign that The world’s largest economy is weakening as the Federal Reserve raises interest rates.
* German 10-year bond yields, the euro zone benchmark, rose 3 basis points (bps) to 0.932%, remaining below a two-week high of 1.025% hit last Friday.
* The dollar index, which measures the greenback’s performance against six currencies, rose to 106.87, its highest value since August 8. The euro, the most heavily weighted currency in the dollar index, fell 0.28% to 1.01305.
* Brent crude futures fell 1% to $94.11 as weak economic data from top crude buyer China renewed concerns of a global recession, and the market closely watched talk of a revival. of a deal that could allow more Iranian oil exports.
* WTI crude futures were down 0.98% at $88.52 a barrel.
* Spot gold dipped slightly to $1,775.6 per ounce as a stronger dollar made bullion less attractive and investors eyed future Federal Reserve rate hikes.
(Additional reporting by Anshuman Daga, Edited in Spanish by Ricardo Figueroa)