Australia

Australian shares are set to open lower, after U.S. stocks gained as worries about an impending recession receded slightly.

ASX futures were down 0.24% or 19 points as of 8:00am on Wednesday, suggesting a lower open.

A rally for US stocks still left investors battered by the markets' wild swings and are bracing for more turbulence.

The S&P 500 rallied 1%, boosted by gains in all 11 of the index's sectors. The Dow Jones Industrial Average added 0.8%, or about 294 points, and the tech-heavy Nasdaq Composite rose 1%.

In commodity markets, Brent crude oil was down 0.1% to US$76.19 a barrel, while gold was down 0.8% at US$2,390.82.

The Australian dollar was at 65.19 US cents, up from its previous close of 65.17.

Asia

Chinese shares ended higher after volatile trading early Tuesday as the Asian equity markets went through a technical correction following Monday's selloff. The benchmark Shanghai Composite Index ended 0.2% higher at 2,867.28, the Shenzhen Composite Index rose 1.2% and the ChiNext Price Index gained 1.25%. Consumer services and property sectors led the gains with Offcn Education Technology up 9.95% and Poly Developments & Holdings adding 3.9%. Insurance stocks led the losses with China Life Insurance down 6.1% and China Pacific Insurance falling 5.7%.

Hong Kong shares ended lower for a fourth straight session, with the Hang Seng Index falling 0.3% to 16,647.34. The decline followed Wall Street losses as U.S. recession fears intensified, Saxo Markets analysts say in a commentary. Insurers were among the biggest losers, with China Pacific Insurance slumping 10%, China Life Insurance shedding 4.5% and AIA Group down 2.4%. Gainers included WuXi AppTec, which added 6.2%, and WuXi Biologics, which was 3.1% higher. The Hang Seng Tech Index edged 0.1% higher to 3342.52.

The Nikkei Stock Average closed 10% higher at 34,675.46, its biggest daily percentage gain since October 2008, after Monday's 12% drop triggered bargain hunting and the yen gave up some of its recent gains. Electronics and heavy-industry stocks led Tuesday's advance. Tokyo Electron climbed 17% and Hitachi Ltd. surged 17%. USD/JPY was at 145.69, up from 144.17 as of Monday 5 p.m. ET. Investors were focused on earnings and conflicts in the Middle East. The 10-year Japanese government bond yield rose 13 basis points to 0.885%.

India's Sensex closed 0.2% lower at 78,593.07, weighed by finance stocks, reversing earlier gains. The main theme overnight was risk-off following the global selloff, which reflected market panic about the U.S. economy, the Commerzbank Research team said in a note. Investors are also worried about elevated valuations driven by the AI rally, Commerzbank added. Among decliners, State Bank of India fell 1.3%, HDFC Bank lost 0.75% and IndusInd Bank was 0.7% lower. Among advancers, JSW Steel rose 2.3%, while Tech Mahindra and Larsen & Toubro each gained 1.6%.

Europe

Stocks in the U.K. rose Tuesday, as the FTSE 100 Index increased 0.2% to 8026.69.

Among large companies, Keller Group PLC was the biggest gainer during the session, surging 12%, and Raspberry Pi Holdings PLC surged 11%. Melrose Industries PLC rounded out the top three movers on Tuesday, as shares surged 6.6%.

Domino's Pizza Group PLC posted the largest decline, dropping 7.1%, followed by shares of Rightmove PLC, which fell 4.3%. Shares of Endeavour Mining PLC fell 4.0%.

In other parts of Europe markets closed mixed, with the STOXX Europe 600 Index up 0.3% to 488.44, Germany's DAX gained 0.1% to 17,354.32 and France's CAC 40 fell 0.3% to 7,130.04.

North America

A rally for stocks still left investors battered by markets' wild swings and bracing for more turbulence.

Traders were regaining their footing Tuesday after fresh fears about the economy and fallout from the unraveling of some of Wall Street's most popular bets sent stocks tumbling.

The market seemed to stabilize as stocks rallied across industries. Everything from industrials to technology to small-caps traded higher, while Wall Street's fear gauge, the Cboe Volatility Index, or VIX, dropped 28%, its biggest decline since 2010, according to Dow Jones Market Data.

All told, the S&P 500 rallied 1%, boosted by gains in all 11 of the index's sectors. The Dow Jones Industrial Average added 0.8%, or about 294 points, and the tech-heavy Nasdaq Composite rose 1%.

The S&P 500 now is up 9.9% in 2024, after paring its advance from 19% at its July record.

"Investors are realizing that fundamentally really nothing has changed," said Tim Courtney, chief investment officer at Exencial Wealth Advisors. "The economic numbers that we've seen play out over the last couple of days, especially the jobs report last week, they have been slowing for some time."

The major indexes remained in negative territory for the week after the S&P 500 and Dow industrials on Monday suffered their worst days since September 2022.

Tuesday's gains followed a partial market recovery in Japan. The Nikkei 225 rallied 10%, a day after the index tumbled 12% in its worst day since 1987, after the infamous Black Monday selloff in the U.S.

The popularity of a Wall Street bet called the carry trade meant far-flung consequences for the Bank of Japan's move last week to raise its benchmark interest rate. For years, Japan's ultralow rates had lured investors to borrow yen to buy riskier assets like U.S. stocks.

A strengthening yen has forced such investors to buy more of the currency, pushing it higher and prompting more margin calls.

Meanwhile, the big tech stocks that have powered the U.S. market to new heights have come under scrutiny, with some investors suspecting their prices have grown disconnected from their profits. In one closely watched move, Warren Buffett's Berkshire Hathaway revealed Saturday that it had sold nearly half its mammoth Apple stake in the second quarter.

The Magnificent Seven technology stocks were mostly higher Tuesday. Nvidia and Meta Platforms rallied 3.8% and 3.9%, respectively, while Apple fell 1%. On Monday each member of the group fell at least 2.5%.

Lackluster economic data has added to the worries. A report Friday showing a slowdown in hiring helped drive the Nasdaq Composite into a correction, a drop of more than 10% from its recent high in July. That followed weakening manufacturing and construction data Thursday.

"We've had a handful of data points now that point to an economy that's probably a little bit weaker," said Chris Shipley, co-chief investment officer at Fort Washington Investment Advisors. "The market is starting to think that the Fed needs to cut rates, as opposed to gets to cut rates."

Many investors think trading could remain choppy. The S&P 500 notched its fifth consecutive daily move of 1% or more, its longest such stretch since one ending in February 2023, according to Dow Jones Market Data.

In bond markets, the yield on the benchmark 10-year U.S. Treasury note ticked higher, snapping a streak of falling yields that had lasted eight trading days. It settled Tuesday at 3.887%, up from 3.783% on Monday.

Oil prices gained, ending a three-session losing streak. Global benchmark Brent crude rose 0.2% to $76.48 a barrel.

Earnings reports drove moves among individual stocks. Caterpillar shares gained 3% after the maker of bulldozers, excavators and dump trucks beat profit expectations. Uber Technologies shares jumped 11% after the ride-hailing and food-delivery company recorded higher-than-expected earnings. Shares of WK Kellogg dropped 7%, meanwhile, after the cereal business spun off from Kellogg posted lower-than-anticipated profits.