Risk Sentiment Stabilises, Won Buying Weighs On USD Crosses

Risk catches breath after Monday's rout, with e-mini futures now creeping into positive territory, even as regional equity benchmarks falter on a negative lead from Wall Street. Stabilisation in sentiment has applied pressure to the safe-haven yen, while lending support to the Antipodeans.

• Spot USD/JPY held above neutral levels, printing its best levels in a month (Y137.71), before taking a dive into negative territory. U.S. Tsy yields remain under scrutiny, with the curve twist steepening a tad in early Tokyo trade.
• Regional risk barometer AUD/JPY has added a handful of pips but struggles to break above yesterday's high as G10 crosses are happy to respect relatively contained ranges.
• The Korean won regained poise as South Korean authorities warned against speculative offshore trading. USD/KRW sales have applied light pressure to greenback crosses.
• This seemingly contributed to the aforesaid pullback in USD/JPY as well as a move away from highs in USD/CNH. The DXY index is back below the 109 mark.
• Manufacturing PMI readings from across the globe will keep crossing the wires through the day, with U.S. new home sales & EZ consumer confidence also due. ECB's Panetta will participate in a policy panel.