Dollar Volatility Continues as Markets Shrug Off Iran Sanctions Plans

Global markets showed signs of calm on Tuesday after investors shrugged off U.S. plans to expand sanctions against Iran, which had been touted as 'economic D-Day'. The U.S. Treasury Department stopped short of imposing penalties, but warned countries to cut their financial ties with Iran or face secondary sanctions.

The news sparked a modest overnight pull-back in oil prices and benchmark government bond yields, but the markets quickly regained composure. European shares started 0.3% higher, while the dollar inched higher against the euro and Japanese yen.

Analysts point to a 'negative bias' towards the dollar due to concerns about the U.S. fiscal situation, with yields rising and the dollar weakening over the last month.

Meanwhile, Bitcoin crossed the $80,000 level for the first time since mid-May, while gold ticked down 0.6% to $4,624 per ounce. The tech sector is holding its breath for Nvidia's results on Wednesday, with analysts expecting quarterly revenue to almost double to around $92 billion.

Wall Street futures were pointing to a slightly higher opening later in the day, but broader market sentiment remains wobbly. Over in Asia, MSCI's broadest index of Asia-Pacific shares outside Japan ended up 0.4%, with South Korea and Taiwan gaining, while China's CSI300 blue-chip index was down 0.2%.