Asian stocks were in a guarded mood on Tuesday as investors pondered fresh political uncertainty in European markets, Reuters reported.

Moves were mostly modest, with MSCI’s broadest index of Asia-Pacific shares outside Japan dipping 0.5 percent in thin trade. Chinese blue chips fell 1.2 percent, having been shut on Monday, while the yuan hit a seven-month low.

Going the other way, Japan’s Nikkei firmed 0.3 percent and South Korea stocks rose 0.4 percent.

Europe market

EUROSTOXX 50 futures also edged up 0.2 percent, steadying after Monday’s retreat, while FTSE futures were flat.

The euro, French stocks and government debt had been shaken after investors assessed the developments related to potential political instability.

Bond yields rose across Europe, with the spread between French and German debt widening notably.

U.S. market

Elsewhere, markets gave a muted reaction to Apple’s long-awaited AI strategy, which integrates “Apple Intelligence” technology across a suite of apps. The iPhone maker’s shares were down 0.3 percent in after hours trade, having slipped 1.9 percent in normal hours.

S&P 500 futures and Nasdaq futures both eased 0.1 percent in Asian trading, after edging higher on Monday.

The market has, so far, proven remarkably resilient to the jump in U.S. yields that followed Friday’s jobs report and the pull back in expectations for Federal Reserve rate cuts.

U.S. rate cut

Futures imply 38 basis points of Fed easing for this year, compared to 50 bps before the jobs report.

The Fed is considered certain to hold steady at its policy meeting on Wednesday, with the focus on whether it keeps three rate cuts in its “dot plot” projections for this year.

The consumer price index (CPI) is forecast to rise a slim 0.1 percent in May, but with the core up 0.3 percent.

Forex

In currency markets, the euro steadied around US$1.0768, after hitting a one-month low overnight at US$1.0733. It has lost about 1.1 percent in the past two sessions, undermined by the U.S. jobs reports and political uncertainty.

The dollar was broadly supported at 157.27 yen and just short of its May top of 157.715.

The weakness of the yen is one reason the Bank of Japan (BoJ) might decide to taper its bond buying at a policy meeting on Friday, as a step toward another rate hike.

Commodities

Gold was just above one-month lows at US$2,302 an ounce, after getting whiplashed by the pullback in market pricing for U.S. rate cuts.

Oil prices consolidated Monday’s 3 percent rally, as various investment banks tipped strong summer demand for fuel and potential U.S. crude purchases for its petroleum reserve.

Markets are also awaiting monthly oil supply and demand data from the U.S. Energy Information Administration and OPEC on Tuesday, and the International Energy Agency on Wednesday.

Brent dipped 7 cents to US$81.56 a barrel, while U.S. crude was unchanged at US$77.74 per barrel.