Australia

Investors appear set for early losses on the share market after their US counterparts became cautious ahead of a Federal Reserve meeting.

The local SPI 200 futures contract was down by 86 points, or 1.39 per cent, to 6,098.0 at 8.15am Sydney time on Wednesday, indicating losses in share values early.

Overnight, the S&P 500 and Dow fell as the Federal Reserve began a two-day meeting.

While no major policy announcements are expected when the US central bank wraps up on Wednesday, investors will scrutinise its remarks on the health of the economy, which has been reopening after coronavirus-related closures.

The Dow Jones Industrial Average fell 300.14 points, or 1.09 per cent, to 27,272.3, the S&P 500 lost 25.21 points, or 0.78 per cent, to 3,207.18 and the Nasdaq Composite added 29.01 points, or 0.29 per cent, to 9,953.75.

The Australian share market on Tuesday climbed for the sixth consecutive day and the S&P/ASX200 benchmark index finished up 146.2 points, or 2.44 per cent, at 6,144.9 points, while the All Ordinaries index climbed 146.4 points, or 2.39 per cent, at 6,262.9.

The Australian dollar was buying 69.55 US cents at 8.15am. That was higher from 69.37 US cents at the close of trade on Friday.

Asia

China stocks ended higher on Tuesday, tracking gains in broader markets, as easing of coronavirus-induced lockdowns in many countries continued to fuel optimism about a quick economic recovery.

At the close, the Shanghai Composite index was up 0.62 per cent at 2,956.11.

Hong Kong shares closed at their highest level in three months on Tuesday, tracking gains in broader markets as the easing of coronavirus-induced lockdowns in many countries fed short-term investor optimism of a quick economic recovery.

At the close of trade, the Hang Seng index was up 280.45 points, or 1.13 per cent, at 25,057.22. The Hang Seng China Enterprises index rose 1.12 per cent to 10,121.13. Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.91 per cent, while Japan’s Nikkei index closed down 0.38 per cent.

Europe

Banks and oil companies led European stocks lower on Tuesday as investors turned wary ahead of the US Federal Reserve’s policy meeting.

The pan-European STOXX 600 index fell 1.2 per cent, while the main markets in Frankfurt, London and Paris were down between 1.6 per cent and 2.1 per cent.

After a stunning 46 per cent recovery from all-time lows, eurozone banks fell 3.8 per cent after an EU financial stability watchdog said banks should not be allowed to pay dividends at least until the end of this year.

Oil majors Royal Dutch Shell, BP and Total fell between 3 and 4.5 per cent as oil prices fell due to a stronger dollar and oversupply concerns.

Other sectors considered most geared to economic growth such as automakers, travel and leisure and insurers, which led a market recovery in the recent weeks, fell between 2 per cent and 3.4 per cent.

Investors were also awaiting the conclusion of the Fed’s monetary policy meeting on Wednesday for its views on recent signs of economic recovery.

The World Bank said on Monday the coronavirus crisis will cause global economic output to contract by 5.2 per cent in 2020, warning that its forecasts would be revised downward if uncertainty persists.

However, a surprise recovery in US jobs data and unprecedented stimulus from central banks have helped push the European benchmark to just 15 per cent below its record high, while Wall Street's tech-heavy Nasdaq confirmed a return to a bull market on Monday.

Healthcare and technology stocks, which have taken a hit in recent days, rose 0.7 per cent and 0.1 per cent.

British American Tobacco slid 3.1 per cent after it cut annual targets, citing a demand hit from stricter lockdown measures in key emerging markets.

North America

The S&P 500 and Dow fell on Tuesday, pausing after recent strong gains as focus shifted to the Federal Reserve, while the Nasdaq ended at an all-time high for a second straight day after briefly rising above the 10,000 mark for the first time.

The Fed began a two-day meeting. While no major policy announcements are expected when the US central bank wraps up on Wednesday, investors will scrutinise its remarks on the health of the economy, which has been reopening after coronavirus-related closures.

The Nasdaq’s gains came on the back of strong gains in tech-related shares, a day after the index became the first of Wall Street’s major indexes to confirm a new bull market. Apple, up 3.2 per cent, gave the Nasdaq its biggest boost on Tuesday.

The benchmark S&P 500 fell back into negative territory for the year after temporarily erasing those losses on Monday.

The rally in US stocks accelerated last week after strikingly upbeat May jobs data strengthened views that the worst of the economic fallout from the pandemic was over.

Financial and industrial shares, which have been among stocks that have surged in recent weeks on hopes of an improved economic outlook, were the biggest drags on the benchmark S&P 500 on Tuesday.

The Dow Jones Industrial Average fell 300.14 points, or 1.09 per cent, to 27,272.3, the S&P 500 lost 25.21 points, or 0.78 per cent, to 3,207.18 and the Nasdaq Composite added 29.01 points, or 0.29 per cent, to 9,953.75.

US financial market operators, including the New York Stock Exchange, held a moment of silence in honour of George Floyd, a 46-year-old African American who died on May 25 after a white police officer knelt on his neck for nearly nine minutes.

The S&P 1500 airlines index tumbled 7.5 per cent, while cruise operators Carnival Corp and Norwegian Cruise Line Holdings Ltd fell following their recent sharp recovery amid recent signs of a pickup in global travel.