(Alliance News) - London's FTSE 100 is called to open a touch lower on Tuesday, while Asian markets struggled to make inroads after a less-than-stellar session in New York overnight.

The conviction that interest rates have peaked, and will soon start being cut, lifted equities last month. December has kicked off on a more cautious note, however.

Meanwhile, the Reserve Bank of Australia kept interest rates unchanged.

IG says futures indicate the FTSE 100 to open 10.5 points lower, 0.1%, at 7,502.46 on Tuesday. The index of London large-caps closed down 16.39 points, 0.2%, at 7,512.96.

The Nikkei 225 was down 1.3% in late trade in Tokyo, while in China, the Shanghai Composite lost 0.9% in afternoon trade. The Hang Seng in Hong Kong was 1.7% lower.

In New York on Monday, the Dow Jones Industrial Average lost 0.1%, the S&P 500 fell 0.5% and the Nasdaq Composite gave back 0.8%.

"US stocks are experiencing a decline, influenced by indications that interest rates may have reached a bottom, at least temporarily, triggering a subtle reversal of the positive momentum seen in November when both equities and bonds made significant gains," SPI Asset Management analyst Stephen Innes commented.

"Price action in the S&P 500 suggests rates-driven pressure on tech and a bit of risk aversion under the surface as investor focus this week remains on macro releases as we get the November Payrolls report Friday - a key data point to assess if growth is holding up and whether rate cut mania is justified."

The pound was quoted at USD1.2636 early Tuesday in London, up from USD1.2620 late Monday. The euro rose to USD1.0842 from USD1.0817. Versus the yen, the dollar traded at JPY146.97, down slightly from JPY147.02.

The Reserve Bank of Australia left its cash rate target unchanged at 4.35% on Tuesday, but noted the path towards a cooler inflation rate has been "looking slower than earlier forecast".

"While the economy has been experiencing a period of below-trend growth, it was stronger than expected over the first half of the year. Underlying inflation was higher than expected at the time of the August forecasts, including across a broad range of services," the RBA said.

"The limited information received on the domestic economy since the November meeting has been broadly in line with expectations. The monthly CPI indicator for October suggested that inflation is continuing to moderate, driven by the goods sector; the inflation update did not, however, provide much more information on services inflation."

The RBA said there are "significant uncertainties around the outlook" and whether more monetary policy tightening is needed depends on "the data and the evolving assessment of risks".

Brent oil was quoted at USD78.01 a barrel early Tuesday, down from USD78.53 late Monday. Gold was quoted at USD2,034.56 an ounce, up from USD2,025.87.

Tuesday's economic calendar has a slew of services PMI readings, including the eurozone at 0900 GMT and the UK at 0930 GMT.

The local corporate calendar has half-year results from equipment rental firm Ashtead and first-quarter numbers from plumbing and heating products company Ferguson.

By Eric Cunha, Alliance News news editor

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