By Wayne Cole
SYDNEY (Reuters) - Asian share markets were mostly in the red on Tuesday while the U.S. dollar began to edge higher once again aided by a media report the Federal Reserve might take a rhetorical step toward tightening at its meeting next week.
Oil prices also extended their long crash with U.S. crude hitting its lowest in five years amid a glut of supply and pressuring energy stocks globally.
Dealers said the dollar got a lift from a Wall Street Journal report that Fed official were seriously considering dropping an assurance that short-term interest rates will stay near zero for a ?considerable time?.
Such a move would be taken as a sign the central bank was on target to start raising interest rates around the middle of next year, a view that has gained great traction since last week's upbeat payrolls report.
Yields on two-year Treasury debt
The rise in yields has in turn underpinned the dollar which nudged back up to 120.94 yen
Asian stocks markets were mostly lower following a decline on Wall Street, though the losses were minor. MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> was off 0.36 percent.
Japan's Nikkei <.N225> eased 0.47 percent, but that follows a run of strong gains which took it to its highest since July 2007. Chinese shares have also been on a tear with the CSI300 index <.CSI300> of the largest listed companies in Shanghai and Shenzhen at levels last visited in 2011.
On Monday, the Dow <.DJI> had lost 0.59 percent, while the S&P 500 <.SPX> fell 0.73 percent and the Nasdaq <.IXIC> 0.84 percent. [.N]
There was no respite for oil as U.S. crude futures
Oil prices are likely to remain around $65 a barrel for the next six to seven months until the global economy recovers or OPEC changes its production policy, the head of Kuwait's state oil company said.
The lack of inflationary pressure combined with a rising U.S. dollar kept gold on the back foot. Spot prices
(Editing by Shri Navaratnam)
