Crude Settles Higher After Steep Fall on Euro Zone

OIL FUTURES: Crude Settles Higher After Steep Fall on Euro Zone - WSJ.com

Crude oil futures settled modestly higher Tuesday, after a tumbling 4% a day earlier on renewed worries of economic weakness in the euro zone.  Prices moved broadly throughout the session, lifted by early news of improving manufacturing data in China, the world's second-biggest oil consumer. China's purchasing managers index rose to a five-month high in July of 49.5 from 48.2 in June, but a reading below 50 still indicates weakness.

Japan Flags Yen-Sales Impact as BOJ Newcomer Sees Easing Scope

Japan Flags Yen-Sales Impact as BOJ Newcomer Sees Easing Scope - Bloomberg

Japan’s Finance Ministry judged its record foreign-exchange intervention last year to have proved effective, while a newcomer to the central bank’s board said it may be able to do more to stabilize the currency.  The comments highlighted the risk of further action by policy makers to counter gains in the yen, which has climbed for four straight weeks against the dollar. Europe’s debt crisis is undermining demand for Japanese exports and drove the currency to an 11-year high against the euro this week.

Spain Bonds Drop Amid Bailout Concern

Spain Bonds Drop Amid Bailout Concern - Businessweek

Spanish bonds fell, pushing five- and 10-year yields to euro-era records, as the nation’s borrowing costs rose at an auction amid concern its banks’ and regions’ debts will force it to seek a sovereign bailout.  Italy’s 10-year bonds declined for a third day after services and manufacturing in the euro region shrank in July. Germany’s bunds sank, pushing up yields from near all-time lows, after Moody’s Investors Service cut the outlook on the nation’s top rating citing concern it will have to support weaker euro- region members. Government debt from the Netherlands fell as its outlook was also lowered by Moody’s, along with Luxembourg.

Treasury Bonds Rebound on Soft U.S. Data

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Treasury Bonds Rebound on Soft U.S. Data - WSJ.com

Treasury bonds rebounded Tuesday from earlier losses as fears over the global economic outlook lured investors into safe assets.  The latest jolt to investors' sentiment came from a report by the Federal Reserve Bank of Richmond. The region's manufacturing index tumbled to negative 17 in July, a sign of contraction and the lowest level since April 2009.