A look at the day ahead in European and global markets from Ankur Banerjee
Traders remain in vigilance mode over the prospects for Japanese currency intervention as the yen crawls ever so close to 150 per dollar, victim to a strong dollar that scaled a fresh 10-month peak against its major peers.
With more hawkish rhetoric overnight from Federal Reserve policymakers - about interest rates needing to stay higher for longer to battle inflation - and with Treasury yields at a 16-year peak, investors' risk appetite has all but disappeared as Europe wakes up.
MSCI's broadest index of Asia-Pacific shares outside Japan sank on Tuesday to its lowest this year.
Tuesday also brought fresh verbal warnings on the yen, with Japanese Finance Minister Shunichi Suzuki saying authorities were watching the currency market closely and stood ready to respond.
Suzuki added that whether to intervene would be determined by volatility, and would not target specific levels.
And yes, we have been here before. Traders have kept a wary eye for a few weeks now on possible intervention as the "will-they-won't-they" discussion rages on.
The dour mood is set to continue, with futures indicating a lower open in European markets. The pan-European STOXX 600 index touched its lowest in more than six months on Monday and will likely test lower still on Tuesday, with very little economic data on deck to draw investor attention away from rate jitters and rising yields.
Meanwhile, Australia's central bank held interest rates steady on Tuesday for a fourth month but again warned that further tightening might be needed to bring inflation to heel in a "reasonable timeframe".
In company news, Birkenstock, the German premium footwear brand, has targeted a fully diluted valuation of about $10 billion in its highly anticipated U.S. initial public offering, as IPO activity manages a revival after a two-year drought.
Key developments that could influence markets on Tuesday:
Economic events: Switzerland CPI for September, U.S. JOLTS data; ECB board member Philip Lane to participate in panel discussion