World markets turn lower ahead of comments by Fed chair

Annabelle Liang, Associated Press

A man walks by an electronic stock board of a securities firm in Tokyo, Tuesday, July 17, 2018. Asian markets fell on Tuesday as mounting tensions over U.S. tariffs overshadowed data suggesting global growth was still on track. (AP Photo/Koji Sasahara)

SINGAPORE (AP) -- World markets turned lower on Tuesday as investors looked ahead to Federal Reserve Chairman Jerome Powell's testimony to Congress for clues on U.S. interest rates.

KEEPING SCORE: Germany's DAX shed 0.2 percent to 12,537 and the CAC 40 in France was down 0.4 percent at 5,3889. The FTSE 100 index fell 0.1 percent to 7,589. U.S. stocks were poised for small losses ahead of the release of industrial production figures. Dow and S&P 500 futures were both down 0.1 percent.

ASIA'S DAY: Most Asian indexes closed lower as tensions over U.S. trade actions rattled investors. Japan's benchmark Nikkei 225 bucked the regional trend, gaining 0.4 percent to 22,697.36 after reopening from a public holiday. South Korea's Kospi lost 0.2 percent to 2,297.92 and Hong Kong's Hang Seng shed 1.3 percent to 28,181.68. The Shanghai Composite index dropped 0.6 percent to 2,798.13. Australia's S&P/ASX 200 gave up 0.6 percent to 6,203.60.

FED COMMENT: Investors are watching for guidance on monetary policy and the economic outlook from the Fed chair's semi-annual monetary report to Congress. The Fed said Friday it expects low unemployment and rising inflation will keep it on track to raise interest rates at a gradual pace over the next two years.

EU-JAPAN DEAL: The European Union and Japan signed a broad trade deal Tuesday that will eliminate nearly all tariffs, coming in contrast to the protectionist policies wielded by U.S. President Donald Trump. The deal covers a third of the global economy and more than 600 million people. Prices of European wine and pork will fall for Japanese consumers. Japanese machinery parts, tea and fish will get cheaper for Europe. The major step toward liberalizing trade has been discussed since 2013 and was largely finalized last year.

NETFLIX: Video streaming service Netflix's report that it is adding subscribers at a slower pace than envisioned, renewed fears that its growth may sputter as competition heats up. Monday's numbers marked the first time in a more than a year that Netflix hadn't exceeded its subscriber growth projection and its shares plunged 12.6 percent in aftermarket trading.

ANALYST VIEWPOINT: "The thud was heard up and down Wall Street as Netflix fell off a cliff in late trading after posting dispiriting subscriber growth last quarter," Stephen Innes of OANDA said in a commentary. "This negative Netflix result could spur more moves into to cash as investors may finally adopt a delayed 'Sell in May and go away' strategy."

ENERGY: Benchmark U.S. crude rose 4 cents to $68.10 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 4.2 percent to $68.06 in New York on Monday. Brent crude, used to price international oils, gained 22 cents to $72.06 per barrel.

CURRENCIES: The dollar rose to 112.51 yen from 112.30 yen late Monday. The euro was steady at $1.1713.