Morning Bid: Australia hikes but tempers its outlook

A look at the day ahead in European and global markets from Tom Westbrook:

Bond markets have curbed a little of last weeks enthusiasm about a prospective peak in global interest rates, but still cheered a rate hike in Australia that looks to be the last of the cycle.

The Aussie dollar fell more than 0.8% and Australian government bonds rallied because the 25 basis point hike by the Reserve Bank of Australia came with a softening of language on whether further hikes would be needed.

The ASX200 (.AXJO) lifted from mid-session lows.

It was an otherwise quiet session in the absence of major updates that might have consequences for the interest rate outlook.

Gravity dragged South Korean shares back to earth, with the Kospi (.KS11), which soared 5.7% on Monday after a short-selling ban was re-imposed, falling 3%.

Three days of strong gains for the MSCI Asia ex-Japan index (.MIAPJ0000PUS) also came to an end.

British house prices, German industrial output and European producer prices are due later on Tuesday, as are earnings from UBS (UBSG.S).

Overnight news from the U.S. included the latest humbling of WeWork (WE.N), which sought bankruptcy protection. It expects to continue in business, but the move represents an admission by majority owner SoftBank that the office-space firm cannot survive unless it renegotiates its pricey leases.