Sliding dollar puts euro above $1.11 for first time thisyear
Nikkei rebound halted around 38,000 yen mark
JD.com shares down 11% as Walmart seeks to sell stake
(Updated at 0800 GMT)
Global shares paused on Wednesday after a weeks-long rebound towards record highs, leaving the dollar languishing at 2024 lows as investors hoped for clearer clues on Friday from the Federal Reserve on the magnitude of future interest rate cuts.
Oil LCOc1 slipped on easing Middle East tensions and estimates of swelling U.S. inventories, while the weaker greenback kept gold near Tuesday's record high.
The MSCI All Country index for global stocks .MIWO00000PUS was trading down just 0.04% at 824.36 points, less than 1% from its mid-July lifetime high and up 13.4% for the year.
In Europe, the STOXX .STOXX index of 600 companies was up 0.1% at 512.76 points, nearing its all-time high of 525.59 on June 7.
Stocks have seen a volatile, rollercoaster ride after investors took fright last month following U.S. jobs data that raised the spectre of recession in the world's biggest economy.
Those worries have since given way to bets on a soft landing cushioned by cuts in borrowing costs starting in September.
Later on Wednesday preliminary revisions to U.S. labour data are due to be published and a large downward revision is expected, helping to support the case for cutting interest rates.
Fed meeting minutes are also expected on Wednesday to reinforce a dovish stance ahead of a speech from the central bank's chair Jerome Powell on Friday.
Interest rate futures have priced in a 25 basis point (bps) U.S. rate cut next month, with a 1/3 chance of a 50 bps cut. Almost 100 bps in cuts are priced in for this year, and another 100 bps next year. FEDWATCH
A potentially unique situation beckons where there are material rate cuts but without a recession, unlike the backdrop for cutting borrowing costs in five of the past seven cutting cycles, said Ross Yarrow, U.S. equities managing director at investment bank Baird.
"If we get a scenario where the Fed are cutting, inflation is falling and employment continues to rise, it really does start to look like a Goldilocks scenario," Yarrow said.
"So I think the rebound in equities and their prospects from here are actually pretty good," Yarrow said.
On Wall Street, the S&P 500 .SPX snapped eight sessions of gains with a 0.2% overnight drop as investors took a breather.
U.S ESc1 stock index futures were slightly firmer.
WALMART SELLS JD.COM STAKE MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 0.5%.
Hong Kong's Hang Seng .HSI slid 0.8% with JD.com 9618.HK dropping 8.6% as top shareholder Walmart WMD.N moved to sell its large stake.
Japan's Nikkei .N225 fell 0.3% as a recovery from its collapse in early August runs into resistance around the 38,000 level.
On Thursday, U.S. and global purchasing managers' index surveys are due.
The falling dollar has launched gold to record highs and returned the yen JPY=EBS to 146.15 per greenback, a gain of about 1.6% for the week so far and some 11% higher than last month's 38-year trough.
The euro EUR=EBS is up nearly 3% for August to date and, at $1.111 in early European trade, is at its highest since early December and testing major chart levels.
The mood kept bond markets supported and 10-year U.S. Treasury yields US10YT=RR nudged lower to 3.81%, while two-year yields US2YT=RR hovered at 3.99%.
Commodity prices stabilised with Brent crude futures LCOc1 at $77.11 a barrel.
Dalian iron ore prices climbed more than 4% after a Bloomberg report that China plans to allow local governments to buy unsold homes in the latest property-market support measure.
China is the world's biggest steel consumer and markets are sensitive to any signs that construction could get back on track.
Big miners' shares (BHP) (RIO) (FMG) were steady in Australia, and gained in London.
Gold prices XAU= hovered at $2,509 an ounce, just below record levels touched on Tuesday.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World FX rates YTD http://tmsnrt.rs/2egbfVhGlobal asset performance http://tmsnrt.rs/2yaDPgn Asian stock markets https://tmsnrt.rs/2zpUAr4 U.S. stocks back up to levels seen before early August selloff https://tmsnrt.rs/4dT7Pkx
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> ((To read Reuters Markets and Finance news, click onhttps://www.reuters.com/finance/markets For the state of play of Asian stock markets please click on:
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