(AP) -- World shares were mixed Tuesday as investors awaited a decision by the Federal Reserve on interest rates.
Benchmarks rose in Hong Kong, Paris and Frankfurt but fell in Sydney and London. Trading was light with markets in mainland China, Japan and some other countries closed for holidays.
Oil prices fell and U.S. futures edged higher.
Australia's central bank lifted its benchmark interest rate to 0.35% from 0.1%, the first such hike since 2010. The Fed is expected to announce a rate hike Wednesday as it and other central banks battle inflation that has been hovering at 40-year highs.
Australia's S&P/ASX 200 fell 0.5% to 7,307.50 on Tuesday.
Investors also are expecting another rate hike by the U.S. Federal Reserve as it and other central banks accelerate efforts to curb inflation. The central bank is expected to raise short-term interest rates by double the usual amount when it releases its latest statement on Wednesday. It has already raised its key overnight rate once, for the first time since 2018, and Wall Street is expecting several big hikes in coming months.
That will make it more costly to borrow -- for a car, a home, a credit card purchase and may weaken the economy. It also would draw investments out of stocks into other assets as their yields rise. Ultra-low interest rates helped drive stocks to unprecedented highs during the pandemic and now that process is being reversed.
In early European trading, Germany's DAX rose 0.6% to 14,021.72 while the CAC 40 in Paris advanced 0.8% to 6,479.88. Britain's FTSE 100 slipped 0.4% to 7,518.50.
In Asia, Hong Kong's Hang Seng inched 0.1% higher to 21,101.89. The index had rallied earlier in the day on hopes for further easing of coronavirus prevention rules. But it failed to hold onto those gains. The government reported that the territory's economy contracted by 4% in annual terms in the first quarter of the year.
In South Korea, the Kospi shed 0.3% to 2,680.46. Shares also fell in Taiwan and Thailand.
On Monday, a late-afternoon turnaround led by technology stocks left major indexes moderately higher on Wall Street, averting more losses following a brutal April when widespread tech sell-offs dragged down major benchmarks.
The S&P 500 rose 0.6% and the Dow Jones Industrial Average gained 0.3%. The Nasdaq climbed 1.6%. The Russell 2000 index rose 1% to 1,882.91.
Concerns about rising inflation have been hanging over the latest round of corporate earnings. This week is bringing more, with Pfizer reporting results on Tuesday, CVS Health on Wednesday, and Kellogg on Thursday.
The yield on the 10-year Treasury was at 2.98% after rising to 3.00% on Monday. It hadn't been above 3% since Dec. 3, 2018, according to Tradeweb.
Higher yields make bonds increasingly attractive assets relative to more risky and expensive stocks, particularly those of technology and other growth-oriented companies.
European energy ministers were meeting in Brussels to discuss Russian supply issues and sanctions. Russia's invasion of Ukraine has prompted a jump in already high oil and natural gas prices.
U.S. benchmark crude oil lost $1.11 to $104.06 per barrel in electronic trading on the New York Mercantile Exchange. It gained 48 cents to $105.17 per barrel on Monday.
Brent crude shed $1.18 to $106.40 per barrel.
In currency trading, the dollar was at 130.13 Japanese yen, down from 130.15 yen on Monday. The euro fell to $1.0500 from $1.0505.