Stocks edge up as oil slips

Pumpjacks are seen against the setting sun at the Daqing oil field in Heilongjiang province, China. (Reuters pic)

SYDNEY: Global stocks traded modestly higher Tuesday as investors digested corporate results rolling in for clues on the economic outlook. The dollar edged up while Treasuries held steady.

The Stoxx Europe 600 Index climbed, led by retail and chemical shares. In Asia, shares in China and Hong Kong outperformed markets in Japan and South Korea.

S&P 500 futures pointed to a slightly positive open after the US benchmark slipped from a six-month high as the earnings season kicked into high gear.

Bank of America and BlackRock results are up next on Tuesday. Treasury yields ticked lower after data showed China’s holdings rose for a third month. The yen inched higher.

Investors have spent the holiday-shortened week so far in wait-and-see mode as conviction in the rally that’s powered stocks this year gets tested.

Volumes remain muted as traders assess a complex global economic picture.

Central banks are also in the frame, with Chicago Fed President Charles Evans, who currently sees rates on hold until the fall of 2020, saying that the nation’s central bank may need to cut them if inflation falls.

“We are going into this earnings season with the most pessimistic expectations and earning revisions ratios since 2016,” Isabelle Mateos y Lago, chief multi-asset strategist at BlackRock, said on Bloomberg TV. “Obviously the markets are not expecting too much and a lot of good news are already priced in, so it makes sense for the market to take a pause.”

Elsewhere, West Texas oil slipped on concerns over rising US crude inventories. The Aussie dollar declined after minutes from Australia’s central bank showed that officials concluded there was no near-term need to adjust rates.