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

Gregor Stuart Hunter

Asian markets are crumbling and Brent Crude is bubbling

around $85 per barrel as U.S. Fed Chair Kevin Warsh prepares to

give testimony to Congress over the next two days. No pressure,

then.

Speaking before the U.S. House Financial Services Committee,

Warsh is likely to field questions on the central bank's plans

for its balance sheet. Hawkish commentsthis week by Fed Governor

Christopher Waller have boosted the market odds of more rate

hikes this year - perhaps as soon as later this month.

That prospect, combined with a third consecutive night of

strikes by the U.S. military against Iran and the possibility of

the U.S. imposing a 20% fee on cargo ships passing through the

Strait of Hormuz, roiled markets in Asia on Tuesday.

Brent futures climbed to their highest since mid-June,

while S&P 500 e-mini futures eased 0.2%.

MSCI's broadest index of Asia-Pacific shares outside Japan

was down 1.2%, led by declines for shares in

Taipei and Seoul.

Despite the ongoing bear market in South Korea - at one point on

Tuesday the Kospi had logged its worst two-day decline since the

start of the Iran war - it remains one of the world's

best-performing indexes this year.

In early European trades, pan-region futures were down

0.9%, German DAX futures fell 0.9% and FTSE futures

slid 0.4%.

Chinese stocks fared better than most after data showed exports

surged in June, buoyed by demand for chips and data centre

computing power to fuel the global AI boom.

Meanwhile in Tokyo, Finance Minister Satsuki Katayama said Japan

may consider adjusting the strategy of the giant Government

Pension Investment Fund if the investment environment changes

sharply, several days after saying officials would seek ways to

encourage greater investments in domestic financial assets. She

gave few further details, however.

Elsewhere, as the Ebola outbreak intensifies, the Trump

administration on Monday said it was blocking American citizens

in the Democratic Republic of Congo from travelling back to the

U.S. on commercial flights, according to a White House official.

Key developments that could influence markets on Tuesday:

Company earnings:

JPMorgan Chase ( JPM ), Bank of America Corporation ( BAC ),

Goldman Sachs ( GS ), Wells Fargo ( WFC ), Citigroup

Economic data:

U.S.: June CPI and core inflation

Debt auctions:

Germany: 2-year government debt